Volume 2 Number 48
November 28, 2005


Consumer Services HelpLine Number 800-342-2762






CFO Gallagher and a consumer specialist help a victim with insurance issues after Wilma

 

The press discusses the situation after Wilma with CFO Gallagher

 

Consumer specialists confer with consumers in the mobile assistance vehicle

 

FLORIDA’S 2005 HURRICANE SEASON NEAR ITS END

Hurricane Season 2005 officially comes to a close on Wednesday, November 30, but we will be dealing with the aftermath for years to come.

Nationwide, this season was the busiest on record so far, with 27 named storms and 11 federal disaster declarations.  The four hurricanes that hit Florida – Dennis, Katrina, Rita and Wilma -- caused 63 deaths and about $10.5 billion in insured damage. 

One month after Wilma, about 700 people remain in hurricane shelters, waiting for county or FEMA housing assistance. FEMA said it has approved about 39,000 applications for temporary housing, at a cost of $76 million.

 

South Florida's nursery industry suffered losses of more than $800 million. Damage to Florida's agricultural industry is estimated at $2.2 billion. 

Evacuations and airport closures resulted in the loss of millions of dollars in tourism business, the state's largest industry with 76.8 million visitors last year.  The Florida Keys
had an estimated $40 million in lost business from Wilma alone.

 

The first to make landfall in Florida was Hurricane Dennis on July 10.  The Category 3 storm struck between Pensacola Beach and Navarre Beach with a wind speed of 110 mph. To the east of Dennis along the Gulf Coast, extensive damage was caused by a storm surge of up to 12 feet. The storm caused the deaths of 14 people and left about $1 billion in insured losses. 

Then on August 25, Hurricane Katrina made landfall in South Florida between Hallandale Beach and North Miami Beach as a Category 1 packing winds of 80 mph.  Another 14 people died in Florida and insured losses came to $468 million. She caused far more damage when she hit Louisiana and Mississippi as a Category 4, and became one of the most devastating storms in history, taking hundreds of lives along the Gulf Coast and forcing the largest relocation in American history.  

Hurricanes Rita and Wilma followed, each about a month apart. Rita passed south of the Keys on September 20 as a Category 2 hurricane with a wind speed of 100 mph. No deaths were reported in Florida, but $23 million in insured losses were tallied.  Wilma came in from the west coast and exited on the east coast on October 24, making landfall in Cape Romano. A wind speed of 125 mph cast her as a Category 3 storm. The estimated insured losses have reached $9 billion, and 35 deaths were blamed on this storm.  

Each of the past two hurricane seasons has brought four major hurricanes each – eight storms in about 15 months.   
Some 600,000 Floridians turned to the Department of Financial Services for help, and Chief Financial Officer Tom Gallagher hosted seven town hall meetings across the state – providing direct help to hundreds of Floridians.  FLDFS consumer service specialists advocated on behalf of nearly 61,000 consumers struggling with their insurance companies, with 88% of complaints resolved in the consumers’ favor.

The department also set up four mediation centers in hurricane-hit areas and has conducted more than 11,000 mediations to date, with a 92% settlement rate, and has funneled $43 million to hurricane victims burdened with multiple hurricane deductibles.

The State Fire Marshal’s office provided more than 13,000 hours in search and rescue efforts. 

Also, based on his experience in the aftermath of Hurricane Andrew in 1992, CFO Gallagher: 

  • Initiated a moratorium on insurance companies canceling or non-renewing homeowners’ policies.
  • Placed a 10-percent cap on the fees public adjusters can collect on a homeowner’s insurance claim and prohibited them from charging fees up front.
  • Required Florida’s health insurers and HMOs to waive restrictions on prescription refills to enable citizens to fill prescriptions in advance. 
  • Set deadlines for insurers to respond to policyholders and process claims.
  • Established mediation program to give storm victims a no-cost way to quickly resolve claim disputes with their insurance company.
  • Pushed for and won approval for a simpler insurance policy form that is easier for consumers to read and understand.

This year, CFO Gallagher is urging immediate action to improve Florida’s insurance market, including the creation of a national catastrophe fund, tax-free hurricane savings accounts for Florida homeowners, and strong statewide building codes. 

While forecasters are predicting busy hurricane seasons for some time, it is important to reflect on what we have endured so we can carry the important lessons forward – that it pays to be prepared, and that Florida will survive.