Does your car insurance policy cover hurricane damage? If you
are living in the state of Florida, or another high-risk region,
be sure to purchase a comprehensive policy to cover damages in
the event of a storm.
Automobile damages resulting from Hurricane Wilma have resulted
in more Florida insurance claims than either Hurricane Katrina or
Hurricane Rita. Vehicle damage can range from scratches and
dents to shattered windshields, and sometimes the complete
wreckage of an automobile. Windborne debris and fallen trees may
be responsible for most storm-related claims. More complicated
claims arise when drivers collide at intersections without
working traffic signals due to power outages.
State Farm and Progressive are the two largest auto insurance
providers in the state of Florida. One week after Hurricane
Wilma hit Florida, State Farm had received over eighty-seven-
thousand claims, almost thirty-five-thousand of which were for
automobile damage. Progressive Insurance reported that it
received more automobile insurance claims related to Hurricane
Wilma than for any other hurricane last year.
Not all cars have insurance coverage for hurricane damage. The
policy holder has to have purchased the 'comprehensive' policy in
order to be insured for damage to their vehicle resulting from a
hurricane. While homeowners must purchase a separate policy to
cover flood damage, auto insurance includes flooding in the
comprehensive policy.
One problem for hurricane related automobile damage is the high
volume of claims occurring at one time. Body shops can be
inundated with damaged vehicles and policy holders may experience
a delay in getting their cars repaired and returned. Adjusters
typically check on the most severe claims first. Larger auto
insurance carriers, such as State Farm, can call on insurance
claim adjusters from other states to share the burden of visiting
damaged vehicles. Due to general hurricane damage to hard-hit
areas, insurance company representatives may have trouble gaining
access. Even if access is not a problem, adjusters can still
face heavy traffic and long lines at gas stations, just as
residents do following a hurricane. It is important for
insurance company representatives to survey damaged vehicles
quickly, as policy holders are often encouraged to refrain from
having their automobiles repaired until the adjuster has visited.
Following Hurricane Wilma, about 225,000 automobile claims were
filed in the state of Florida. According to the Florida Office
of Insurance Regulation, there were approximately 180,000 claims
filed by Floridians in 2004 for damage to vehicles resulting from
Hurricanes Charley, Frances, Ivan, and Jeanne.
According to Insurance Services Office Inc., (ISO), property and
casualty insurers would pay approximately $6.1 billion to policy
holders in the state of Florida for losses from Hurricane Wilma.
The ISO Property Claim Services unit asserted, in a November 28,
2005 press release, that ninety percent of the catastrophe losses
from twenty-two events resulted from three hurricanes. The year
to date catastrophe losses could be as much as $50.3 billion,
according to the ISO Property Claim Services unit. Hurricanes
Katrina, Rita, and Wilma were responsible for $45.2 billion of
catastrophe losses. ISO Property Claim Services expected to
receive approximately 750,000 claims relating to damage of
personal and commercial property, automobiles, boats and yachts.
In a press release dated January 26, 2006, Insurance Services
Office, Inc. revealed that United States property and casualty
insurers would pay a record breaking $56.8 billion to homeowners
and businesses for property losses in 2005. The actual amount of
property damage insurers will pay exceeded the estimated amount
by $6.5 billion. This number breaks the previous record, of
2004, when $27.3 billion was paid by insurers for catastrophe
claims.
Ninety-three percent, or $52.7 billion, of the insured losses for
2005 were accounted for by Hurricanes Katrina, Wilma, Rita,
Ophelia, and Dennis. ISO also reported that over eighty percent
of these claims came from policy holders in just five states;
Louisiana ($27.2 billion), Mississippi ($12.2 billion), Florida
($9.9 billion), Texas ($2.9 billion), and Alabama ($1.5 billion).
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