ARM Agencies Reflect and Project One Year After Katrina

“You could almost feel it, the bond that had formed as we worked to bring our agency back to life, help our clients, and assist each other through the most trying times we will hopefully ever know.” These are the words of Douglass C. Mills, insurance agent, VP/COO, and disaster plan coordinator for Gillis, Ellis & Baker Inc. (GEB), a 73-year-old, third-generation insurance agency based in downtown New Orleans. One year after our nation’s most catastrophic hurricane Katrina, GEB is among the lucky businesses that survived.

Perhaps more auspicious was the disaster plan GEB had put in place just weeks before Katrina hit on August 29, 2005. (The company’s proximity to Florida’s four hurricanes in 2004 raised its awareness of looming losses and moved the management team to action.)

With the help of two companies—Agility Recovery Solutions who secured temporary office space and equipment in Baton Rouge, and Artizan Internet Services who provided customer service back-up—GEB was operational within five days after the storm. Working round-the-clock, they fielded more than 10,000 calls and 3,000-plus claims, simultaneously assisting their 37 employees, many of whom lost their homes and possessions themselves.

Beyond extraordinary efforts to come through for its clients and as countless other businesses were failing, GEB has built a new, even stronger customer base.

“Our game plan was not to retreat or ‘hunker down,” Mills says. “We had responded quickly and effectively after the storm.”

Today, it has rectified 90 percent of Katrina claims, and 148 of its 150 largest clients have reopened for business. “We see it as our duty to the community to do our part in the rebuilding,” Mills adds.

Despite GEB’s positive outlook and as other Associated Risk Managers (ARM) affiliates attest, the future of Gulf Coast agencies is still undecided, depending on the willingness and ability of insurance companies to write and renew business in the region.

“There are new rules and much tougher standards,” says Ty Hopkins of Hopkins Insurance Agency in Kaplan, La.

Premiums have skyrocketed as much as 50 percent on personal lines and have doubled and tripled on commercial lines. “The storm exposed a lot of people who were vulnerable,” he adds.

Brenda Case of Lowry-Dunham, Case & Vivien in Slidell, La., says her company was overwhelmed for the first six months since the flooding. “We were totally engrossed in handling claims,” she says. It was not until March 2006—seven months after Katrina hit—that her company returned to “normal” operations, and she herself just moved back into her own home this month. Case sees much higher deductibles, as businesses struggle to preserve their livelihoods, fighting just to make insurance available—and affordable. On a positive note, the agents see promise in the rebirth of a newer community.

“The city’s infrastructure will be even stronger,” Brenda predicts.

As these agencies head into their second year of recovery, they view the future with guarded optimism.

Mills explains: “We need for the insurance companies to do what they are in business to do: accept risk for an adequate rate and with terms and conditions that allow the client to properly manage their financial risks.”

Associated Risk Managers is independent agency network that encompasses more than 400 agency members and represents more than $4 billion annually in premium volume.

Source: ARM Partners

Topics Agencies