The Independent Insurance Agents of Virginia (IIAV) is motivated to “redouble its efforts” around hurricane preparedness, particularly as it relates to flood damage, since following Hurricane Harvey’s impact in Texas, according to President and CEO Robert Bradshaw in an emailed statement to Insurance Journal.
Bradshaw said that insurers need to rededicate themselves to educating the public on the risks of flooding as well as coverage options this Atlantic hurricane season, which began on June 1 and ends November 30.
Hurricane Harvey made landfall in Texas late Friday as a Category 4 storm with 130 mph winds, the fiercest hurricane to hit the U.S. in more than a decade, according to reports in the Associated Press. Although it weakened overnight to a Category 1 and eventually to a tropical storm, rainfall from the storm could continue for days with more than 40 inches of water predicted in some communities, the Associated Press reported.
“I can think of no event where the agents and insurance companies don’t learn something,” Bradshaw said regarding IIAV’s continued monitoring of the situation in Texas. “The predominate thing we learned is that areas where citizens believed they were immune from flooding find that is not the case.”
He cited the importance of distinguishing traditional renters insurance from renters flood insurance. Many standard homeowners’ and renters policies don’t cover flood damage, making it an important consideration for insurers and their clients, according to information from the Insurance Information Institute (III).
“We can’t help but listen to the interviews with people in Houston who have no flood insurance,” Bradshaw said. “People react after an event but often forget the message. And for good or bad, it’s been a while since Hurricane Isabel hit Virginia.”
Last year, flood damage proved to be a large source of claims for insurers in Virginia in the wake of Hurricane Matthew, with Virginia Department of Emergency Management officials saying it was the costliest storm since Hurricane Isabel in 2003.
Indeed, on October 8, 2016, Hurricane Matthew’s rain bands and wind resulted in more than 11 inches of rain in southeastern Virginia. The storm caused flooding and damage in areas of Hampton Roads that typically aren’t impacted by floodwaters, according to an announcement from the Virginia Department of Emergency Management.
Flooding is the nation’s number one natural disaster, with roughly 25 percent of all flood insurance claims filed in low- to moderate-risk areas, according to data from III. Although wind damage from tropical storms and hurricanes is covered under standard homeowners, renters and business insurance policies, flood damage is excluded. Separate flood coverage can be purchased from FEMA’s National Flood Insurance Program and some private insurers, according to III.
“The next eight weeks or so are typically the busiest time for tropical cyclone activity in the Atlantic,” a spokesperson for the Virginia State Corporation Commission said in an email. “It’s a good opportunity for the Bureau [of Insurance] to remind Virginians…of the importance [of] planning ahead for hurricanes and other disasters, including reviewing their insurance coverage.”
A spokesperson for State Farm Insurance said that given Hurricane Matthew’s impact on Virginia last year, it has ramped up its efforts to communicate with residents this year about the importance of being prepared for a storm. State Farm received 3,240 homeowner claims in Virginia from Hurricane Matthew last year, with an additional 1,980 auto claims.
“The number of Virginia residents impacted by Hurricane Matthew serves as a strong reminder of the importance of having appropriate insurance coverage in place,” the spokesperson said, adding that the top three things to discuss with an insurance agent before a storm are appropriate replacement cost coverage, flood insurance and deductibles. “With the start of hurricane season, now is the time for homeowners to talk to their insurance agent before a hurricane hits.”
According to 2012 data, the most recent available data published on III’s website from AIR Worldwide, the estimated value of insured commercial and residential coastal properties vulnerable to hurricanes in Virginia is about $182.3 billion.
With all of this in mind, Virginia Tech experts are advising those on the Atlantic coast and in the Gulf of Mexico to be prepared for potential storms.
“Virginia has not experienced a significant number of hurricanes in the past couple of years, but there is always the exception,” Michael Martin, an extension specialist with Virginia Cooperative Extension focusing in emergency response and preparedness, said in a news release issued by Virginia Tech.
In 2004, Virginia experienced five significant hurricanes, which produced 59 tornadoes, he added. Based on the expectation of near-neutral to weak El Niño conditions and above-average sea surface temperatures, a near-average to slightly-above average Atlantic hurricane season is expected, Stephanie Zick, an assistant professor and tropical meteorologist in Virginia Tech’s College of Natural Resources and Environment, stated in the release.
Zick told Insurance Journal that although peak hurricane season, which is measured in terms of the number of storms that form, is right now through the beginning of September, storms are more likely to impact land later in the season. This has to do with climatology and wind patterns, she explained.
“Just like every hurricane season, it only takes one storm,” she said.