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The Insurance Climate Change
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Issue
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| Contributor | ArmyDem |
| Last Edited | ArmyDem Feb 01, 2007 01:49am |
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| Category | News |
| News Date | Monday, January 29, 2007 07:00:00 AM UTC0:0 |
| Description | Coastal homeowners in the East are losing their policies or watching premiums skyrocket. Carriers say that global warming is to blame.
By Karen Breslau
Newsweek
Jan. 29, 2007 issue - During the nine years she's lived in her historic sea captain's house on Cape Cod, Mass., Paula Aschettino never filed a claim against her homeowner's insurance policy. But last year she received a letter from her insurer, Hingham Mutual Group, canceling coverage on her nine-room, $600,000 oceanfront home, which has withstood its share of hurricanes since 1840. She and her husband, Michael, scrambled to find other insurance but were repeatedly denied. "They just said we are in a high-risk area," she says. A spokesman for Hingham, which canceled 9,000 Cape Cod policies, says that the company's own coverage—known as "reinsurance"—had doubled in the past year, making it necessary to withdraw from the coastal market.
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Up and down the Eastern Seaboard, hundreds of thousands of policyholders like the Aschettinos are being dropped by their insurers; many more have had to swallow double-, even triple-digit increases in premiums and deductibles. While discontinued policies and rate hikes are nothing new in hurricane-battered Florida and the Gulf Coast, insurers are now dinging homeowners in the Northeast and mid-Atlantic states. Allstate Insurance recently announced it wouldn't take new homeowner policies in New Jersey, Connecticut and Delaware—or the five boroughs of New York City. The company also won't renew 30,000 of more than 600,000 policies it carries in and around New York City. A host of other firms are refusing to insure properties along the Atlantic coast from Maine to the Carolinas.
Why the sudden rash of cancellations? An increase in "extreme weather events" that many scientists—and now insurers—believe are linked to climate change. |
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