A Florida state panel has approved the use of a new hurricane catastrophe model that is increasing many homeowner and Florida business insurers’ exposure.
The Florida Commission on Hurricane Loss Projection Methodology has approved the Risk Management Solutions new U.S. Hurricane Model version 11.0 for use in residential insurance rate filings submitted to the state’s Office of Insurance Regulation.
The new model calculates the probability of hurricane damages and financial losses taking into effect wind, other weather characteristics, and the density of development within a given area.
The RMS model includes a number of changes, but most notable is the change in loss projections. Based on the results of a three-year research and development project conducted with the University of Miami, the model decreases the risk of losses in coastal areas while increasing them in inland areas.
As a result, many insurance companies that specialize in providing coverage to
homeowners insurance in inland areas have seen their exposure increase by 50 percent to 70 percent.
Insurers have already been feeling the impact of the new model, which reinsurers have been using to set rates.
Bracing for the possibility of higher reinsurance rates, lawmakers inserted in this year’s property bill a measure allowing insurers to make separate filings for rates on reinsurance and financial interments needed to make up for the loss of other reinsurance products. The increase is limited to one per year with the rates not to exceeded 15 percent per policyholder.
If you have a question about how the new rules may effect homeowners insurance rates for your Florida homeowners policy contact the experts at Valek Insurance and Bonds.
posted by Jim Valek on
Fri., Sep 23rd, 2011 in
Homeowners
Hurricane Season
Insurance
Insurance Company Industry News
Valek Insurance, in the Sarasota, FL area is advising people to check their
homeowners insurance during this hurricane season. Researchers from Colorado State University are
predicting above average hurricane activity is expected, and that the U.S. coastline has a higher than usual chance of being in the path of at least one major hurricane this season. Researchers estimate the likelihood of at least one hurricane making landfall on Florida is 71%, and 5 major stoms (a category three, four or five) is markedly above the 2.3 average for the last century.
The official Atlantic hurricane season runs June 1st through November 30th.
Once a storm is within range of land it is too late to change or add coverage. Valek Insurance says it is imperative that people review their homeowners insurance right away.
Valek Insurance is offering the following tips to make sure Floridians homeowners insurance will provide adequate coverage this Florida hurricane season:
Hurricane Deductible - Some states have implemented separate deductibles for hurricanes based on a percentage of the home’s insured value. Note that wind damage caused by non-hurricane storms is subject to the policy’s general deductible not the hurricane deductible.
Flood Insurance -
Flood damage is not covered under a standard homeowners’ policy, but flood insurance is essential in high risk areas.
Replacement Cost vs. Actual Cash Value — Replacement Cost policies cover the amount needed to replace or repair a home without a deduction for depreciation. These policies generally cost about 10 percent more, but they provide much more comprehensive coverage than Actual Cash Value policies.
Guaranteed or Extended Replacement Cost — Provides additional coverage if widespread damage inflates the cost of building materials and labor.
Inflation Guard - Automatically adjusts policy limits to reflect changes in construction costs so homeowners do not have to increase limits each year.
Building Code Upgrades - If a home is severely damaged, it will need to be rebuilt to comply with current building code standards that could add increased building costs. Law and ordinance coverage ensures these extra costs are covered.
Additional Living Expenses - Covers the costs of living elsewhere while a home is being rebuilt or repaired.
To protect assets this hurricane season, also:
- Inventory, photograph or video tape all household items. Keep receipts, inventory lists, copies of the homeowner’s insurance policy and insurance company contacts in a safe place that can be accessed in the event of a storm.
- To minimize losses, take steps to protect personal property when a hurricane is imminent, such as covering windows with shutters, siding or plywood.
Keep materials such as plywood and plastic on hand for temporary repairs after a storm. Keep receipts as repairs are made, as they may be reimbursable by an insurance company.
- Be wary of rushing into a contract or placing a hefty deposit with a company for repairs. Unfortunately, fraudulent contractors often flock to natural disaster sites, so it is important to consult with an insurance agent before hiring anyone.
About Valek Insurance
As an independent
insurance agency serving Sarasota and all of Southwest Florida, we will work hard to find the best options for your unique insurance needs. Valek Insurance and Bonds can search our extensive number of insurance carriers to find the best price. Our clients benefit from the years of experience and local knowledge of Sarasota, Bradenton and all of southwest Florida. We inform our clients of not only the least expensive policy options but the best options available to ensure the right decision. Gain peace of mind with the experts at Valek Insurance. Call now for
free quote
posted by Jim Valek on
Sat., Jul 16th, 2011 in
Be prepared
Hurricane Season
Insurance
For Sarasota Florida's residents living with hurricanes every year is not new. However even though last year was relatively quite with thankfully nothing like hurricane Katrina, Charlie or Gustav, If you don’t prepare yourself, your home, your car, and other valuables you could pay the price later. The best way to avoid disaster is to be prepared, and these simple tips will help you do so.
Plan Your Hurricane Evacuation
The local weather authorities will issue Florida hurricane evacuation warnings, but many times it’s too late, or the traffic on the road may prevent you from leaving for hours placing you and your family into a potentially dangerous situation. It is best to monitor the storm yourself, instead of waiting for the final decision from the authorities. If it's going to b a powerful storm evacuate beforehand, just to play it safe, many in Katrina's path had grown complacent over the years and Floridians should lear that lesson. In your hurricane evacuation plan do not forget to bring social security cards, government IDs, banking information, home and car titles, and of course, your
auto insurance; which you should have in your car at all times.
Hurricane Car Safety
Before storm season an a hurricane is heading toward the coast, have a mechanic inspect your car for any potential problems - a mechanical failure with a category 3 or 4 hurricane bearing down is a worst case scenario. During hurricane season include with your storm preparation checklist that you keep your car or truck with a full tank of gas. Many Floridians will remember hurricane Charlie increased in strength from a category 2 to a monster 4 in only three hours - not a great time to be at the gas pump! You may have to gas up days before the evacuation date, as gas shortages are fairly common in these desperate situations. Take your car to the mechanic to get an oil change, necessary repairs, and new tires, if any of these are needed. Driving conditions during these brutal storms, can be equally dangerous and the biggest hazard will be other drivers so be sure your auto insurance coverage is adequate.
You of course should reinforce the house where ever possible to reduce damage. Windows and doors are particularly important to board up - the special screws for securing plywood to Florida's masonry block homes are called "Tap Cons", and it is advisable to have a supply handy before hurricane season - your local hardware or home improvement store may be sold out during an oncoming storm leaving home owners of older pre-storm shutter homes no way to board up the windows. Don’t forget to reinforce your garage as well! Large objects like ladders and wood should be moved from the garage to avoid unnecessary damage. Cover your car with a tarp, or something with padding, if you have it. Secure the tarp as best you can. - Before hurricane season check you
homeowners insurance coverage! many homeowners find out only when it's too late that they were under insured and have to pay for major home repairs out of their own pockets.
Hurricane Auto Insurance Tips
Protection from hurricane damages requires a comprehensive coverage policy. If you live in an area prone to hurricanes, get comprehensive coverage well in advance. Some Southwest Florida
insurance companies will refuse to sell auto insurance to those living in these areas during hurricane season, and federal law requires it take 30 days before comprehensive coverage goes into effect from time of signing. Don’t procrastinate on getting coverage, hurricane season is under way, and you’ll be happy you did.
posted by Jim Valek on
Fri., Jul 15th, 2011 in
Be prepared
Hurricane Season
Insurance
Safety
