Alabama Beach Pool Reports Progress on Coastal Insurance Issues

September 4, 2008

The Alabama Insurance Underwriting Association, a.k.a. the Beach Pool, released a progress report on a series of coastal insurance recommendations made by a state task force following Hurricane Ivan in 2004. The 20-member hurricane insurance issues task force released its final report in August 2005, just prior to Hurricane Katrina making landfall.

“Unlike a hurricane which can strike swiftly and forcibly, it often takes time and deliberation to implement changes in policy but members of the Beach Pool are proud to report the significant progress we’ve made over the past few years,” said Robert Groves, AIUA association manager. “The bottom line is that the Beach Pool response to task force recommendations has enhanced our ability to provide coverage to those coastal residents who cannot find an alternative choice in the private market.”

Groves said the task force divided its work into three committees: alternative markets, coverage restrictions and exclusions and claims coordination. The alternative markets committee managed the majority of Beach Pool issues. Committee recommendations called for the expansion of coverage, change in the make up of the board to include non-industry representation, review of rates, credits for wind mitigation and better construction, redefining territories and the ability to build surplus.

In response to the task force recommendations the AIUA board of directors now includes two public sector members and available coverage is increased to $500,000, as well as replacement cost and theft coverage, Groves said.

In addition, rating zones were redefined to create a Gulf Front territory and credits are available for wind mitigation and homes built to fortified standards. The Alabama Insurance Department Rules reviewed rates in May 2007 and the 2008 State Legislature codified the Beach Pool which previously had been referred to as a voluntary plan, authorizing the plan to retain earnings to build surplus, Groves added.

A complete list of the Task Force recommendations and progress to date is accessible at AIUA currently insures approximately 10,000 properties with total exposures of $1.7 billion.

Source: Alabama Insurance Underwriting Association

Was this article valuable?

Here are more articles you may enjoy.