Southwest Florida girds for hurricane season

31 May 2015 | Author: | No comments yet »

2015 Hurricane Guide: Everything you need to know about hurricane season.

FORT MYERS, Fla. While Florida’s property insurance market has stabilized somewhat since eight storms battered the state in 2004 and 2005, as storms such as Hurricane Wilma caused billions in damages, the state still has some of the nation’s highest homeowners insurance rates.Hurricane season starts June 1, and although forecasters with the National Weather Service are calling for a relatively docile season, they warned people not to take that lightly.That being said, scientists are predicting a below-average 2015 Atlantic season, with about seven named storms, three of which are expected to strengthen into hurricanes — tropical storms with winds greater than 73 mph.

While there is no preventative measure to stop a hurricanes from reaching Florida, preparation is paramount and it requires going beyond buying generators and stocking up on batteries, bread and water. — The death toll continues to rise as carbon monoxide poisoning claims more people in the wake of one of the most powerful natural acts in Southwest Florida history.

A recent national report showed that Florida’s average homeowner premium of more than $2,000 a year is twice the national average. “There are people on fixed incomes that no longer can afford homeowners insurance,” Palm Beach County resident Daniel McMahon wrote to Gov. From a hurricane more than 10 times deadlier than Hurricane Katrina to a North Carolina hurricane ghost, here are five interesting things about these natural disasters you may not have known. Florida officials believe they are as ready as possible, in terms of storm preparation and the financial strength of the insurance industry, for the next hurricane that crashes into any part of the Sunshine State’s shoreline.

In March, Citizens Property Insurance Corporation, the state-backed insurer of last resort, shrank to less than 600,000 policies, well below its 1.5 million peak in 2005. Forecast tracking has improved, and even the use of social media – the state directs people to its “Get a Plan!” website – has given the state another means to communicate with the public pre- and post-storm. Additionally, the State Board of Administration (SBA) enhanced the state’s financial resiliency when it authorized the Florida Hurricane Catastrophe (Cat) Fund to transfer up to $1 billion of potential catastrophic risks and losses to the global private market.

But with the 2015 hurricane season starting Monday, officials say the question remains how well-prepared individual Floridians will be when a storm packing sustained winds of 74 mph or greater finds Florida. “I think we’re ready. This coverage is another prudent step in protecting residents, businesses and nonprofits from new hurricane taxes in the event of catastrophic losses. We do a lot of work March through May to get ready for June 1,” said Florida Division of Emergency Management Director Bryan Koon after joining President Barack Obama in a pre-storm season briefing Thursday at the National Hurricane Center in Miami. A “FEMA City” of trailers emerged in Punta Gorda and aerial views of areas such as Cape Coral showed a sea of blue tarps covering rooftops damaged by powerful winds. Consumers are benefiting from this because the state’s “hurricane tax” — surcharges related to those previous storms — is disappearing from their insurance bills.

Yet Florida continues to have the most expensive property insurance premiums in the nation, and questions remain about the strength of many private insurers headquartered in the state. “It’s good relative progress, but the progress isn’t fast enough,” said Michael Letcher, president of Home Insurance Buyers Guide LLC, a Lake Worth company that rates home insurers and helps consumers navigate the market. The state agency recently ran a pair of drills, testing officials and public and private agencies to assess how they would respond if different parts of the state were hit by storms.

The charge is added to all insurance bills, including auto insurance, if Citizens or the catastrophe fund lack sufficient money to pay off storm claims. In the most-recent scenario, officials portrayed the Panhandle getting hit by a hurricane and a week later a second storm crossing South Florida, following the path of the killer 1928 hurricane that crossed Lake Okeechobee. “Those emergency managers, I think they are (ready),” Koon said. “And businesses and non-governmental charitable organizations, I’m confident in all of them. In addition to fires, winds uproot weaker trees and open up the forest canopy for a greater diversity of plants and animals.” Gulf coast hurricanes have racked up tens of billions of dollars in damage in the past, according to a report by the National Oceanic and Atmospheric Administration. Reinsurance is the millions an insurer spends with an out-of-state or foreign company to provide the company financial backing in case of major claims. “I fully expect insurers to submit lower rate requests and pass along savings to consumers as market conditions strengthen and reinsurance rates go down,” McCarty said in a statement. Combined with nearly $4 billion in private reinsurance coverage, the surplus means that Citizens can now withstand the type of massive storm only expected every 100 years without running short of cash to pay claims.

NOAA Administrator Kathryn Sullivan, in a release from the White House on Thursday, referred to the 1992 hurricane season that was punctuated by the monstrous Hurricane Andrew, which swept across South Florida. “A below-normal season doesn’t mean we’re off the hook,” Sullivan said in the release. “As we’ve seen before, below-normal seasons can still produce catastrophic impacts to communities.” “We’ve had some luck,” Miller said. “We had luck with (Hurricane) Katrina, which brushed the Keys. As the cost to transfer the risk is barely higher than the cost of borrowing, with no obligation to pay anything back, the decision to transfer risk in lieu of additional bonding makes good economic sense.

So when things got intense we had them in the bathroom and covered them with mattresses.” “You see the devastation, power lines are down, street signs are down,” Taylor said. “The first time we got on the road the firetrucks were responding with no windshields because they had been blown out. But people who look at this say this just can’t continue.” Still, Miller is in the camp viewing Florida, which skirted through the recession with relatively little money behind the state’s Hurricane Catastrophe Fund, as being financially prepared to respond to a massive storm.

As with any policy issue, there are opponents who believe inland Floridians should continue paying the bulk of post-storm taxes so the privileged are able to enjoy beachfront properties. The “Cat Fund,” created after Hurricane Andrew to provide backup coverage to property insurers if major storms hit the state, has about $17 billion available. The top 10 private home insurance companies in Florida, as measured by the total amount insured through policies that include hurricane coverage, increased their surplus by $510 million from the end of 2013 to the end of 2014. There is a nightmare hurricane out there that will hit Miami, and we’ll do the best we can.” Also count Jay Neal, director of the advocacy group Florida Association for Insurance Reform, among those expressing more concern about the response of Floridians than the private insurance industry. Risk transfer opponents are often from ritzy coastal areas and favor the government insurance scheme that relies on others to pick up the tab for high-risk, high cost development.

The only storm to bring hurricane force winds to Florida, the Mid-Atlantic and New England, Donna made landfall as a Category 4, ravaged nearly the entire state, re-emerged in the Atlantic Ocean and made several more landfalls. And these policy holders will continue to see increases in the future including the next round in January. “If you buy a coastal home, you should expect to pay an appropriate rate for exposure to that home,” Gilway said. “The hurricane risk, the wind risk and the flood risk clearly is significantly higher along the coast.” The reasons for Florida’s high rates have triggered endless argument among state lawmakers and others in the last two decades.

The lack of storms has been a key factor in the improved financial status of Citizens, along with a massive depopulation effort that since 2012 has driven nearly 1 million policies into the private market. The Cat Fund has a cash balance due largely to an incredible 10 storm-free years, which has enabled managers to collect $3 billion in hurricane taxes from all policyholders since 2005. Michael Carlson, the head of a trade group that represents a number of large nationwide insurers with affiliates in Florida, questioned the state’s continued efforts to support the smaller Florida-based companies in a recent opinion piece. Across southwest Louisiana, the surge stayed around 3 to 6 feet, but increased significantly west of Grand Isle, reaching 17 feet in parts of Cameron Parish. The reality is they are asking us to pay 10 percent more every year from now on to avoid the chance to pay 2 percent more after a storm.” (TM and © Copyright 2015 CBS Radio Inc. and its relevant subsidiaries.

This strategy can be costly, though, leading to much higher homeowners’ rates when reinsurance prices spike, as they often do after a storm makes landfall. While most of the rate filings submitted to the Florida Office of Insurance Regulation over the last 18 months proposed either to lower rates or hold them steady, consumers have not noticed much of a difference. The Great Red Spot is a raging storm about two or three times the size of our planet, and has been there at least since Galileo first spotted the Solar System’s largest planet in 1610, according to NASA.

The Great Hurricane of 1780 struck the Lesser Antilles, a chain of islands in the Caribbean, killing between 20,000 and 22,000 people in October of that year. Cape Hatteras, North Carolina, is the most-affected area by hurricanes and tropical storms on the U.S. eastern seaboard, and sees a hurricane or tropical storm once every 1.36 years, according to hurricanecity.com. Hatteras is so vulnerable, in fact, that locals tell of a shadowy figure they say walks the cape’s beaches before a particularly nasty hurricane hits. Known as the Gray Man of Hatteras, the ghost walks under the shadow of the local lighthouse, and is said to appear as the first winds of a hurricane hit the island.

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