$1.5B paid on more than 180K Rita claims

The Insurance Council of Texas reported that insurance companies have settled 90 percent of property claims in Texas that resulted from the devastation caused by Hurricane Rita that struck in late September 2005. According to the Texas Depart-ment of Insurance, as of Dec. 21, 2005, more than 180,000 insurance claims had been filed related to Hurricane Rita.

Insurers have paid out more than $1.5 billion for claims and the total is expected to reach $2.4 billion in insured losses in Texas.

In a consumer assistance advisory on its Web site, www.tdi.state.tx.us/, TDI said it assisted 680 Gulf Coast residents affected by Hurricane Katrina and helped 5,123 consumers affected by Hurricane Rita. At the end of February 2006, the department’s Consumer Protection division had logged 1,537 Rita-related insurance complaints. The complaint ratio is less than one percent of all claims, the department said.

ICT said the areas hardest hit by Rita were without power for several weeks making it extremely difficult for relief workers and insurance adjusters to reach policyholders in rural areas. Initially, adjusters working with insurance agents faced the same problems as hurricane victims. With no power, they worked without the use of computers, air conditioning and running water.

Hurricane Rita’s 120 mile-per-hour winds made landfall at Sabine Pass about 14 miles from Port Arthur on Sept. 24, 2005.

Seventy percent of the claims from Hurricane Rita came from residents living near or along the coast in Jefferson, Orange, Hardin, Harris, Galveston and Jasper Counties.

Winds in excess of 100 miles per hour were recorded as far inland as Lake Livingston, 105 miles north of Port Arthur.

Hurricane force winds downed huge pine trees making travel nearly impossible in the east Texas communities of Woodville and Jasper. The Texas Forest Service said more than 400 thousand acres of pine and hardwood trees were either damaged or destroyed in the storm.

According to the Insurance Information Institute, insurers have settled approximately 70 percent of the property claims in Louisiana and Mississippi from the damage caused by Hurricane Katrina that struck Aug. 29, 2005.

TDI noted it is in the process of investigating claims handling practices regarding Hurricane Rita claims, and will take disciplinary actions as needed to ensure compliance with state insurance laws. Data from this investigation will also be used to develop information on best practices that will be useful for the next storm season.

Topics Catastrophe Texas Claims Hurricane