Hurricane Michael Losses Are Likely Higher Than Estimated

Hurricane Michael is behind us, but those affected by it are still sorting through the wreckage. So far, the estimated insurance losses for the hurricane total a staggering $5.6 billion; which is nothing to sneeze at. Unfortunately, new information has come to light that the number of closed insurance claims that have already been reported to the state was likely overinflated. That means that that $5.6 billion number is likely to go up.

Florida Insurance Commissioner David Altmaier spoke about this in a recent town hall meeting, saying that “”This is an issue we’re aware of … we’re going to institute a new reporting category,”.

Hurricane Michael devastated Florida when it made landfall. In total, 145,685 claims were reported. According to the Florida Office of Insurance Regulation 73% of those claims have already been closed. Officials now say that a significant portion of those closed claims are going to be reopened.

Panama City insurance agent Jody Detrick commented about the issue at the same town hall meeting. According to Detrick, “Once they’ve made the payment to the consumer, they probably circle back to them later…It’s more of an issue of we want to differentiate between claims that will be circled back to and ones that are closed,”.

Insurance News Net has been covering this issue and rightfully pointed out that a big reason a lot of these claims were closed early is because of a Florida law that requires property insurers to pay out at least a portion of the benefits owed within 90 days of receiving a claim. As a result, insurers are paying part of a claim, then closing it so they can move on to the next one. In many cases, that means people are not getting the total amount that they deserve.

Unfortunately, a disproportionate number of people who are owed more are older, and don’t understand that they have the right to reopen their claims. Hopefully more people become aware of this issue and take the necessary steps to get the money that they are owed.

Sources:

Insured Hurricane Michael Losses Likely Higher Than Estimated

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