In addition to regular homeowners insurance, Bridget Bello also carries flood insurance and hurricane-specific insurance, making sure she takes the proper precautions to protect herself from Florida’s infamous hurricanes. I thought there was.
But nearly two weeks after Helen’s accident, and even before Milton’s arrival, what Bello, 54, describes as an insurance “nightmare” has only just begun. She said she has already faced delays and denials of compensation claims.
“We did everything we had to do,” said Bello, who lives near Madeira Beach, a barrier island outside Tampa. “We did everything to protect ourselves and protect our homes.”
Hurricane victims in Florida who just suffered the one-two punch of Helen and Milton are facing a difficult time recovering, even those with insurance. The insurance industry classifies the storm as two separate events. That means those who did not or were unable to document damage from Helen could be at an even greater chance of having their claims denied if they were hit by both storms.
Meanwhile, reforms enacted in Florida to encourage insurers to re-enter the state market ended up leaving victims with few legal recourses to challenge claims decisions. There is.
“Most people are trying to maximize their losses and looking for an insurance company to pay their claims,” said Rick Tutwiler, president of claims adjustment firm Tutwiler & Associates. . “A lot of people don’t know what they’re getting into.”
For the majority of affected residents, the economic losses from the storm will be nearly total. That’s because flooding caused much of the property damage, and most homeowners insurance policies don’t cover the effects of flooding.
In the areas of Florida hardest hit by the storm, only 25% of residents had separate flood insurance coverage before the storm hit, according to an NBC News analysis of U.S. government data. Flood insurance coverage was significantly lower in the lower Appalachians affected by Helen.
For those with insurance, the combination of storms will cause major problems.
A resident cleans the front of a mobile home in Sarasota, Florida, on October 10 after Hurricane Milton. Eva Marie Uzcategui/Washington Post – Getty Im
The insurance industry classifies Hurricane Helen as an almost entirely flood event. Hurricane Milton was a combined wind and rain disaster, but thanks to the way many insurance policies are written these days, property owners without flood insurance may not be protected from Milton’s water damage. says the expert.
“In a situation like this, if you don’t have flood insurance, it’s very likely that your insurance company will deny your claim immediately,” said Amy Buck, executive director of consumer group United Policyholders. “It’s expensive.”
Mark Friedlander, director of corporate communications for the Insurance Information Institute, which represents the insurance industry, said he expected insurance companies to face “small” losses from the storm because much of Helen’s damage was due to flooding. He said it would be done.
It is too early to know how many homes will be subject to claims from both Helen and Milton. However, Friedlander acknowledged that in such cases it can be “difficult” to determine which storm caused what, and therefore what is to blame.
Specifically, the appraiser will need to determine whether water damage from Milton occurred “from below,” which could potentially be classified as flood damage. Friedlander said it is “above” as a result of wind-driven rain.
However, even in the latter case, coverage may be denied if it is determined that the rain intrusion is the result of a pre-existing maintenance defect, such as a leaky roof or inadequate insulation. Many policies also naturally exclude wind-driven rain.
Many of the victims facing catastrophic losses from water damage from either storm are “just walking away,” Friedlander said. “Most people can’t realistically afford to rebuild their homes.”
Patty Drew’s home in Punta Gorda, on Florida’s southwest coast, flooded in both the Helen and Milton incidents. Drew, 81, didn’t even have regular homeowners insurance, said his daughter-in-law, Deborah. Approximately 1 in 6 Charlotte County residents agree.
Drew, who lives on a fixed income, hopes the GoFundMe page set up by Deborah will provide some relief.
“I’m heartbroken. I don’t know what else to say,” Drew said. “So there’s nothing you can do about it.”
Experts say the only financial aid available to victims like Drew is through the Federal Emergency Management Agency. FEMA, currently the subject of a series of unsubstantiated claims about its disaster response and funding, had already distributed $344 million in relief payments to approximately 375,000 households as of the Wednesday before the Milton incident. It was issued.
But even victims with flood insurance are finding themselves in financial jeopardy.
The National Flood Insurance Program (NFIP), a government-backed plan that covers 95% of flood insurance policyholders in the United States, only covers up to 50% of losses deemed to be of value to a property (if the property is not built). (Does not include land where land is located).
Above the 50% mark, homes must be rebuilt from scratch almost entirely at their own expense to comply with FEMA flood regulations.
Shane Ostrander walks through the remains of his home in Fort Pierce, Florida, on October 10, the day after Hurricane Milton’s tornado struck. Ostrander and his wife were home when the tornado struck and took shelter in a bedroom closet, which remained intact. Kathleen Flynn/Getty Images for The Washington Post
As a result, Bello and her husband, who live in the Tampa area, expect their home to cost no more than $190,000 to renovate, but based on similar sales in the neighborhood, they believe it could be worth at least seven figures. they spoke.
The NFIP also does not fund temporary housing relocation, so the couple had to spend their own money to find accommodation in the meantime.
A spokesperson for the NFIP, which is administered by FEMA, did not respond to a request for comment.
Driving back from the lodging he secured in Orlando Thursday morning, Bello told NBC News he didn’t yet know the total amount of damage to his home caused by Milton, but said the dock and fence were “gone.” That’s what it means. To my neighbors.
She said she has received about $3,100 from FEMA so far.
When faced with a denial, policyholders may be tempted to litigate. But in Florida, homeowners now essentially have to pay out-of-pocket directly to bring a lawsuit against their insurance company. A series of reforms passed in 2022 are aimed at limiting the flood of contingencies that the insurance industry says are making it impossible to operate in the state.
The reforms have certainly helped stabilize the market, Friedlaender said, and some companies even applied for rate cuts this year before the fall storms hit.
But now that the threat of litigation has lessened, many insurers may have more incentive to essentially automate denials, said Martin Weiss, president of independent insurance rating agency Weiss Ratings.
“There’s financial pressure in the industry, so there’s a very strong incentive to find every possible way to deny the allegations,” Weiss said. “And if the company is new and inexperienced, their attitude might be, ‘What do you have to lose?'” Try denying and see what happens. Sho. ”At least before the impact of the lawsuit. But now that’s all gone. ”
Current developments are starting to spur calls for more comprehensive reform in Florida, with some state legislators calling for changes to the way the insurance industry deals with hurricane damage. .
Given that the state is accustomed to such storms, with them also comes the perception of failure.
Broward County Republican State Representative Chip LaMarca said, “We may be the first members of Congress to ask that we work with our legislators in affected areas to fundamentally change the way insurance is done in Florida.” Posted by County Republican State Rep. Chip LaMarca on Wednesday. “I don’t care what the solution is, but I want to find a solution for all Floridians. We have to fix it.”
