Doug's Blog: Insurance costs hit home, for all of us

By Doug Walker – bio | email

BILOXI, MS (WLOX) - If your home insurance rates have gone up in recent months, you are not alone.  And not just in Mississippi.

During the first week in January, I traveled to the Alabama and Florida coasts for a two part special report on the insurance situations in those state.  And, as I said, we are not alone.

During my travels, I met a widow whose insurance bill has climbed from $2000 a year in 2004 to more than $7000 now.  Another homeowner was told his insurance was going up from $2400 a year to $6300.  He finally got a policy through an independent broker with Lloyd's of London for $4000.  The list goes on and on.

Here in Mississippi, I have seen my own rates go up by 45 percent in the past two years, and most of my neighbors are in the same boat.  Lawmakers and elected officials in Alabama and Florida are wringing their hands in frustration, just as they are here.  No one seems to know what the answer is.  But everyone can describe the problem.  High insurance costs are strangling coastal development and homebuilding.

Alabama Insurance Commissioner Jim Ridling feels that if coastal states banded together to form a windpool of sorts, the increased buying power of all those state could force the rates down, and bring in more competition.  But that's a big risk, and would cost a lot of money.

Blaming the insurance companies is easy to do.  But remember, those agents are your neighbors and friends, and they are feeling the pinch as well.  In fact, two agents I know personally have had their own policies canceled, by the companies they work for.  Talk about bitter irony.

Here's the bottom line, living along the coastline of any state is a big risk.  It's not a matter of if a hurricane will strike.  It's a matter of when, and how powerful.  No one thought Camille could be outdone.  We thought wrong when Katrina roared ashore, washing away property and lives.

One thing is certain.  The more we all spend on insurance, that's less money that we spend on other things, like cars, and refrigerators, and clothing.  Until the problem is solved, our recovery will never be complete.

So if you think you have a solution, write your lawmakers and contact the insurance commissioner.  Tell them your thoughts.  If we all put our heads together, we can overcome this major obstacle.  And we can't do it soon enough.

Be sure to watch for Doug Walker's special reports on the coast's insurance crisis this Wednesday and Thursday nights on WLOX News at 10pm.

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