What Gulf Coast Congressman Gene Taylor wanted the Easter Bunny to bring him.
South Mississippi Living 4/07

Tuesday, August 28, 2007

Katrina Connects the Big Insurance Rip Off Dots

by Ana Maria

Two years ago today, my elderly mother decided to leave our family home and be driven to the home of my eldest brother who lives in Northeast Georgia. She had heard the word "evacuation" and that is when she decided to heed the warning. In the 45 years that my family has lived in the home that my parents had built in 1962, our family home has been a safe haven during every hurricane. For my mother, leaving was a major, major decision and a break from nearly a half-century of tradition.

Throughout the days prior to this decision, however, I recall friends asking me whether my mom had evacuated yet. I scowled as I said that we have never had to evacuate, that we went through [Hurricane] Camille with only the wind knocking down nearly every tree in the yard. Camille had given us mild roof damage only.

My standard response was a somewhat controlled response of "no, my mother has never left that house, which is the safest spot to be. Ours was so safe that others would come to our house because it always weathered every storm." I mean really. What do folks outside of hurricane country know about things like this? About as much as I know of snow storms--which I've never been through.

However, when the recommended evacuation hit the airwaves the day before the storm, my mom decided to leave. Not for a second did she envision what would have taken place in her absence.

At the time, I was living in San Jose , and I didn't paid much attention to the weather reports. The reason is easy enough to explain. Well, maybe they are understandable if you've grown up with hurricanes like I have listening to the reputable weatherman of my youth.

I remember watching the weather channel some years prior. A young reporter stood at the corner of Hwy 90 and U.S. 49 in Gulfport, Miss., with the beach as his backdrop. Conveying with great intensity, he said that the storm of that moment was the worst that the Mississippi Gulf Coast had ever seen. Wind was blowing swiftly, and rain pelted him. I thought to myself, “This guy has obviously not done his homework.” The way this guy was going on and on, you’d have thought that Hurricane Camille were about to blow through my home state.

Once the eye of this small hurricane came ashore, the storm evaporated into thin air. That’s right. It simply . . . disappeared. No more storm. My goodness. I sure do miss Nash Roberts, the meteorologist of my youth who worked at WWL-TV out of New Orleans. His predictions were always accurate.

Ever since then, I have not trusted national weather information. Since I didn’t have access to the local New Orleans or Biloxi television stations, I relied on my family to tell me what was going on, and I trusted their judgment.

So, two years ago today, my brother Rosie drove my mother half way to Georgia and another brother met them half way to drive mom the rest of the 4-5 hours to his home.

Talk about a shock! Our house had, indeed, weathered the “storm” but with damage that we have never experienced since we built the house 45 years ago. Water had risen up the foundation and climbed three feet of stairs dumping almost a foot inside our home. The little twirly things on the roof blew off pouring water into the attic and broke through the ceiling pouring water into the house from the sky above. (Yes, “twirly things” is a technical term.)

When Hurricane Camille ripped through the Mississippi Gulf Coast back in 1969, water poured into homes a mile or so way from the house, some getting 9 to 10 feet in their homes. Not a drop neared our neighborhood. Nevertheless, the neighbors across the street had gone up the country to ride out the hurricane with relatives. One of Camille’s tornadoes ripped off the roof to their up-the-country “sanctuary”. Their own house, like ours, was perfectly safe. Ever since, they have stayed in their own brick home whenever a storm blew our way—including Katrina.

While our family’s home sits on a foundation and then has three feet of stairs before you get into the house, other homes in the neighborhood—like the family across the street—rested at ground level. So when the water rolled down the street from the left and came from the right and then from a third direction as well, my own brothers who had stayed at the home watched from the relative safety of our home never dreaming that the water could enter the house. But it did.

As the water entered our family home, my two brothers as well as the others who had come to the house for refuge watched the once-in-a-lifetime horror as it unfolded before them. One brother looked across the street to see the 80 year old couple pressing their faces against one of the windows looking out as the water rose inside their beautiful home. Our elderly neighbors climbed on furniture to escape the ravages of Katrina’s rising waters, which ended up rising to five feet inside of their sanctuary.

My two brothers felt helpless, because they couldn’t get to our neighbors to help them. The water was too fast and deep. They themselves could have been pulled under were they to attempt the rescue.

Eventually, everyone in our family’s home—including Lemonade, my brother’s dog—ended up in the attic. The water came up then subsided. A nightmare. No one who has lived in the area over the last century as my own family has would have thought any storm could have been worse than Hurricane Camille. But Katrina's devastation dwarfed Camille's.

What's changed?
Since that fateful day nearly two years ago much has changed.

Today, the faith that everyone inside the Katrina-ravaged region had had in the insurance industry has evaporated.

I recall the routine reports I got from mom. “Well, they offered me 'x' for the roof.” Believe me “x” wasn’t enough. So she wrangled with the company. Time passed, and more unnecessary negotiation to be get the insurance company to pay for this or that or the other.

I thought that the process was ridiculous, and I never dreamed that the insurance company would deliberately drag its feet in hopes to settle for half pennies on the dollar. After all, this was one of those boring industries, part of the backbone of our nation's financial security, and a part of nearly every commercial and residential real estate transaction. It would have been ridiculous to consider that the industry could have been engaged in anything as scandalous as deliberately denying legitimate claims or dragging its feet to get out of paying everything it owed each of its customers.

I had wondered whether my mom had lost her ability to take care of business. I mean, this is a woman who was ever so proud to have found a one penny mistake in her favor on a bank statement when I was a kid. When it comes to money, my mother is meticulous and savvy. I recall wondering about the “2 cents for this, maybe a penny for that” kind of claims’ adjudication. Maybe mom didn't "have it" anymore. I was wrong.

What I didn’t realize—as did no one else—was that the insurance industry could legally collude with each other, talking among themselves to say “we won’t pay, you don’t pay.” Professional baseball is the only other exception, and that’s about entertainment. We HAVE to have insurance to get a mortgage for any loans to buy homes and businesses. It’s a MUST have, not a nice to have as may be the tickets for a baseball game.

Think insurance isn’t part of our foundation for economic vibrancy? Ride with me down the Mississippi Gulf Coast beach along Highway 90 from the Biloxi Bridge through all the tiny beach towns dotting the Mississippi Gulf Coast across the Bay Bridge and down both sides of beach boulevard starting in Bay St. Louis, first to the right then to the left until you stop at the end in Lakeshore, Miss. What will we see?

On one side is the beach and water. On the other side, vacant lots, stairs that lead to no where, steal beams standing as a reminder that something had once been there, slabs that used to have homes built one or two hundred years ago. We’ll see barren land waiting for money to finance the rebuilding efforts from families who have themselves faithfully paid their premiums without any insurance company taking them to court for payment of those premiums.

What we won’t see over all those 50 or so miles is one gas station. So we better have a tank of gas before we start this journey. We won’t see the majestic homes that have overlooked the Gulf of Mexico for the last several centuries or even the last 50 years. Katrina wiped them out, gone, disappeared.

There are sporadic signs of new construction, but not very many. This isn’t the week or even the month after the worst hurricane in our nation’s history. Today marks the eve of the two-year anniversary. The ghost town quality to these Mississippi Gulf Coast miles says an awful lot about an insurance industry that has gotten away with stealing our souls, our dreams, our hopes, and our faith and trust that we have “good neighbors” and we’re in “good hands” when it comes to the baseline financial security that is part and parcel of our everyday lives.

This is all so wrong. In our economy, the insurance industry is essential to our ability to build a home, construct a community center or place of worship, and purchase a business. Whether personal, communal, or commercial, the insurance industry is critical to our financial stability.

What Katrina Ripped Apart
Hurricane Katrina did more than rip apart whole towns and cities in her path. She did more than demonstrate that the U.S. government’s levee system in New Orleans could be breached leaving our federal government liable for the damages that ensued. Hurricane Katrina ripped off the fa├žade of financial security for us as individuals, families, and business owners.

How can anyone confidently build a home or a business, pay the ever-permitted gargantuan insurance rate hikes for less and less coverage? Most of us cannot.

The same insurance captains of industry cannot restore the confidence that they themselves have cruelly stolen from us. The industry's cruelty didn't begin with Katrina, and surely it won't end there, either.

Connecting the Big Insurance Rip Off Dots
From East to West, South to North, we see a pattern throughout the country—at the very least—with the major insurance companies. Families and business owners faithfully pay their insurance premiums. Then, Big Insurance maks a calculated decision to leave a state: California out west or Oklahoma located smack dab in the middle of the country or New Jersey in the east or Mississippi in the Southeast. One big insurance company leaves an area as a “competitor” raises its rates substantially. Funny how it works out that way. And it is all perfectly legal to work it out among themselves.

The awful thing is that there is no legal mechanism for us as Americans to facilitate a level and fair playing field by which smaller companies can compete against the major corporations. Additionally, there is no legal mechanism for us to regulate how the industry operates throughout the 50 states though they operate across state lines. Companies in this industry operate without being subject to the same anti-trust laws regulating every other industry that crosses state lines—save that of major league baseball.

So when the recent tornadoes in the Mid-West or the unexpected floods in Ohio or a historical event like Katrina hits our homes and businesses, schools and places of worship, we expect our insurance policies to pay up. That is the purpose of paying our good money to these companies. We keep our end of the contract and faithfully pay our premiums. The insurance companies pay us when we properly submit a legitimate claim. That's the expected course of events.

"It's difficult to exaggerate or embellish upon what's happened here. It's absolutely devastating," [Democratic Ohio Governor] Strickland said. Original image here.
A dump truck passed piles of trash collected from destroyed homes while helping the cleanup effort yesterday after flood waters receded in Ottawa, Ohio. (Matt Sullivan/REUTERS)

Fortunately, we DO have a mechanism through which we can change the situation. Notice I didn’t say that we can change it over night nor did I say we can do it single-handedly. Still, we have a way to change the situation at hand. If you’ve been reading A.M. in the Morning! for a while, then, you know what THAT means.

It's P-O-L-I-T-I-C-A-L Hell Raising Time! Yoohooo!

"Sit up, join up, stir it up, get online, get in touch, find out who's raising hell and join them. No use waiting on a bunch of wussy politicians." Time to go long 1/17/06
"Two kinds of people in the world," Emily said her mom would say. "There are stewers, and the there are doers."
Like Molly Ivins, Emily is from Texas. Emily is one of my most beloved of friends. She and I are definitely among the doer-types. Whether it's about work, family, or life in general, there is simply no use stewing about a situation when we could be doing something to impact the direction of the resolution. The same goes for politics.

To that end, this is today's Political Hell Raising Activity. Call or write your congressional representative to voice your support for one policy for both wind and water. The proposal is called H.R. 3121. Go here for sample phone scripts to read and email letters to send.

Does today's political hell raising activity sound pretty much like yesterday's? Well, in a word: yes! Have you emailed? Please do so. If you have, then make a call. There is no limit to how often you get to voice your support. No, ma'am and no, sir. Already done both? Then, how's about talking with one person about your support for this and why you recommend that they consider supporting it as well.

Feel free to turn this friend or relative on to A.M. in the Morning! It's the only blog talking about insurance reform in a way that is easily digestible, entertaining, charming as well as insightfully informative! Talking to one other person is how we can ensure that through Katrina, we connect the Big Insurance rip off dots.

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