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May 7, 2007

Nationwide to readjust 500 Miss. Katrina claims

Nationwide Mutual Insurance Co. will readjust claims for about 500 Mississippi policyholders whose homes were reduced to foundations by Hurricane Katrina, state Insurance Commissioner George Dale said.

The so-called “slab cases” on the Gulf Coast have been the most contentious insurance issues to arise in the wake of the Aug. 29, 2005 storm. Insurance companies say their policies don’t cover flood damage, including wind-driven water or storm surge.

But, under pressure from regulators and policyholders, the insurers are reevaluating that stance. State Farm Insurance Cos.’ agreement with Dale calls for the company to pay at least $50 million to around 35,000 policyholders in southern Mississippi after their claims are reevaluated.

Nationwide has “voluntarily agreed to open up all of the slab cases on the coast, which should result in more money for the policyholders,” Dale said. “They will be contacted by a different Nationwide adjuster than the adjustment team that initially handled the claim.”

Joe Case, a Nationwide spokesman, said, “Nationwide strongly believes that it has adjusted Katrina claims appropriately. We continue to pursue every measure possible to pay for all damage from Katrina that could be identified as being caused by wind. This voluntary offer is an attempt to resolve some of the most difficult-to-adjust claims by proposing a reasonable payment to affected policyholders rather than investing time and money on less effective options.”

In cases where the cause of damage could not be determined, Columbus, Ohio-based Nationwide initially refused to make any payments, Dale said, adding that the company will now review those cases to “make sure that damage potentially caused by wind would be paid.”

Nationwide has resolved more than 99 percent of the 20,000 claims filed in Mississippi after Katrina and has paid out more than $270 million in covered wind damage, Case said.

From This Issue

Insurance Journal West May 7, 2007
May 7, 2007
Insurance Journal West Magazine

Salute to Managing General Agents/AAMGA Issue; Medical/Health Care Professional Liability; Group Products for P&C Agents/Benefits Brokerage Directory

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