Hurricane Experts Unsure About 2005

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Hurricane expert Max May-field and Rep. Jim Davis attempted to make long-range predictions about future events that will affect the Florida insurance industry during the annual Windstorm Insurance Network Conference in Tampa.

The conference drew more than 500 attendees who heard presentations by industry experts and participated in workshops and panel discussions.

A presentation on “Florida: America’s Hurricane Alley: The Impact of The Big Four in 04” was given by Bill Bailey, Insurance Information Institute special counsel. Bailey who is also co-director of the Hurricane Information Center in Port Charlotte, Fla., moderated a panel of experts titled: “What We Learned from the 2004 Hurricanes.”

The four-day conference included 24 panels and workshops, a few of which included: “Sinkholes, Florida’s Other Catastrophe,” moderated by Rebecca O. Leisure, ROL Insurance Counsulting; “Deposition Training: Rules of the Road,” moderated by Janet Brown, Boehm, Brown, Gischer, Harwood, Kelly & Scheihing, P.A.; and “Cultivating Cultural Relationships: Ethics in the Workplace,” moderated by Aaron Bahraini, an international business and multicultural training consultant.

Weather prediction imprecise
Predicting the weather in general and hurricanes in particular can be a very imprecise science, Mayfield, who is director of the Tropical Prediction Center/National Hurricane Center in Miami, explained.

During Mayfield’s keynote presentation “What a Year! A Review of the 2004 Hurricane Season,” he said hurricane prediction technology and computer modeling techniques have improved, but within two or three years new technology promises to make predictions a lot more precise. He said the accuracy of recent predictions has improved 50 percent, but that new advances will soon make them even more precise.

Mayfield said a newly passed hurricane bill will provide the National Hurricane Center with new hurricane hunting aircraft and enable it to modernize its equipment.

When a meteorologist applies two or three different models to a hurricane each program is likely to predict two or three different paths, according to the veteran hurricane tracker. Mayfield predicted that in two or three years forecasting procedures will become more reliable.

“Don’t focus on that skinny black line, would be a good motto for my tombstone,” Mayfield said, emphasizing that the black line predicting a hurricane’s path can vary immensely, and that the path of destruction can extend for 50 or 100 miles around the center of a hurricane. He said it was lucky that, during the four 2004 hurricanes, the eye of the storms remained relatively small, confining major damage to a limited area.

When Hurricane Charley hit Port Charlotte if the prediction had varied by 15 degrees it would have hit Tampa instead of further south and there would have been major devastation. “But you don’t need a direct hit to cause major damage,” Mayfield cautioned. He described the Hurricane Center’s forecasts for Charley as “very accurate.”

Mayfield showed detailed presentations of the paths followed by each of the four hurricanes and before and after pictures damage done in the hardest-hit areas. He said updated building codes made a big difference in how badly structures were damaged, displaying photos of two residences in one neighborhood in which an older house was demolished and one built according to the new building codes had only only minor damage.

Mayfield’s goal is to change the outcome in the aftermath of hurricanes to minimize deaths and damages. He stressed that while there are deaths and injuries during hurricanes, a lot occur in the aftermath of the hurricane when victims are cleaning up. He said many deaths are related to stress and in some cases even when despondent victims commit suicide.

Mayfield said it was impossible to foresee what the 2005 hurricane season holds. He said that when the hurricane season begins in June there isn’t even any way to predict when the first hurricane will occur. He emphasized everyone should make advance preparation for such hurricanes and said valuable information is presented about how to get ready for the hurricane season every March during Florida’s annual “Hurricane Preparedness Week.”

“We have encountered more hurricanes in the last 10 years than in the 70s, 80s and 90s,” Mayfield concluded. “In 1995 the Atlantic Ocean warmed up and we had lots of hurricane activity after that. Who knows what the future holds, we could have active hurricane seasons for the next 10 or 20 years.

Weaknesses concern congressman
Congressman Jim Davis, D-Tampa, described himself as a novice on insurance topics, but aptly summarized how he viewed the current state of the industry in Florida. Davis said one of his fears was that if fewer insurance companies were doing business in the state, there would be less competition and rate controls and legislation to control the industry would become necessary.

Davis openly supports the National Windstorm Impact Reduction Program which has already been passed, but which he said now needs financial support.

“This is a positive opportunity, I am happy to share details on this,” Davis said. “The short of it is that this bill puts together a group of people in academia, government, private sector and not-for profit, to study research about the most cost-effective and affordable practices for design and construction professionals; and to develop cost-effective and affordable windstorm resistive systems and techniques for the general public.”

He suggested that this program is similar to exercises that took place in Florida after Hurricane Andrew including changes to building codes and other types of planning and coordination that might be necessary. He said it is not just a Florida problem; there are lots of other states with similar issues.

“One of the things I will be looking for in President Bush’s budget is to make sure this program is funded,” Davis said. He said the budget is needed to hire a good staff and equipment to get the program rolling.

Davis served for a while on the Insurance Committee in Tallahassee and said that, clearly the legislature has its hands full.

“I know from personal experience that homeowners insurance markets are very fragile, I don’t know how fragile, but I know that even before the storms the state’s competition is not as good as it needs to be,” Davis said.

He explained that the insurance industry and the consumer agree that they don’t want surprises.

“The bank that owns my mortgage doesn’t like surprises in terms of cancellations or suddenly unexpected premium increases and it’s certain that the insurance industry doesn’t like surprises either,” the congressman said. “I wish I could think like an actuarial but I know that’s part of how the insurance industry has to think and to hope for a level of consistency and reasonableness.

“As a homeowner I want competition, I think that’s one of the best forms of consumer protection,” Davis explained. “My biggest concern right now is the potential tail-spin in which a bunch of companies decide to leave and the government becoming deeper involved in the insurance industry than it already is. We need those tax dollars for other things like education, health care and more important programs.”

He said he is very concerned about what Florida can do to avoid losing companies and frankly what can be done over the short- and long-term to have more companies here for the sake of competition.

“Obviously there is a lot more disagreement than agreement between the consumer, the insured and the industry, that’s why the governor and the statewide elected CFO appointed an insurance commissioner whose job is to preside over the rate-making process,” Davis concluded.

Eight expert panelists who spoke on the topic included Charles R. “Dick Tutwiler, Windstorm Insurance Network president; Janet Brown, Boehm, Brown, Gischer, Harwood, Kelly & Scheihing, P.A.; Joe Adams, Becker & Poliakoff, P.A.; James Shortley, Department of Homeland Security/FEMA; Tim Marshall, Haag Engineering; Art Newman, Belfour; William F. Merlin Jr., Merlin Law Group; and John J. Pappas, Butler Pappas, LLP.

Topics Florida Catastrophe Natural Disasters Hurricane Market Training Development