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Maryland Insurance Commissioner Alfred W. Redmer, Jr. attempted to reassure consumers today by telling them that they should not fear dramatic changes to the insurance market or insurance premiums in Maryland in the wake of Hurricane Katrina.
“While Katrina has wreaked havoc on the lives and property of those in the Gulf Coast, Maryland consumers can rest assured that their rates are based primarily on the company’s experience in Maryland with only a small factor added for national catastrophic losses,” said Redmer. “The Maryland Insurance Administration is committed to reviewing all the rate requests filed to ensure that they are in compliance with Maryland law. That is one of our jobs.”
Maryland law requires that an insurance company’s rates cannot be excessive, inadequate or unfairly discriminatory. The MIA’s review of rate filings is intended to ensure that rates are actuarially justified and that insurance companies will be solvent and able to pay claims in the future. Redmer indicated that Maryland is fortunate to have a healthy and competitive personal insurance market.
Redmer also spoke about his agency’s involvement with Katrina. “I have been in touch with my fellow insurance commissioners in the Gulf Coast to offer our experience and assistance in helping with the recovery,” Redmer said. “We also are coordinating with and participating in efforts spear-headed by Governor Ehrlich and the Maryland Emergency Management Agency, as well as the National Association of Insurance Commissioners, to provide whatever recovery assistance we can to local evacuees and our sister states.’
He added that MIA employees, numbering fewer than 300 state workers, have contributed more than $3,000 of their own money to recovery efforts through an agency collection this week.
He reminded consumers to review their personal needs for insurance with an insurance advisor and make educated purchasing decisions to help protect family and property from similar devastation.
“It is important to remember that your homeowner’s insurance policy does not cover damages sustained as a result of flooding,” said Redmer. “Everyone should consider purchasing flood insurance offered through the federal government even if you do not live in a flood zone.”