Insurers braced for Katia threat
Local insurers are bracing themselves for the possible visit of Hurricane Katia some time next week.
Freisenbruch-Meyer Group said it would be open for business as usual on Monday’s Labour Day public holiday in order to enable its clients to ensure that their property, motor and boat policies were up to date and in effect.
Meanwhile Colonial Group International has put overseas loss adjusters on alert ahead of the potential Category 3 storm’s possible arrival.
Katia was upgraded to a Category 1 hurricane by the National Hurricane Centre yesterday as it continued to gather pace about 1,700 miles southeast of Bermuda, moving northwest.
By Tuesday it is expected to be about 600 miles south of the Island and about 500 miles east of the Bahamas, Christian Science Monitor reported, with forecasters saying that Katia could eventually strengthen into a major Category 3 hurricane with winds over 110 miles per hour.
It is only the second hurricane of the 2011 Atlantic season after Hurricane Irene.
William Madeiros, general manager of Freisenbruch-Meyer Group, said: “Since the news of this potential Cat 3 hurricane, we have seen an increase in client activity and we want to provide the best service for our valued clients, so opening on Monday is necessary.
“Although it is relatively early to accurately determine the direction and intensity of Hurricane Katia, we must take every measure to ensure our clients have the opportunities they need to adequately prepare.
“According to one of the most commonly-used hurricane tracking websites, www.Stormpulse.com, the TVCN Concensus forecast model projects almost a direct hit, along with the BAMD and BAMS models. This must not be taken lightly.”
Mr Madeiros said that the company had asked staff to volunteer to come in on Monday to man the phones and would be putting on meals and a babysitting service for them.
“We are very aware of our responsibility as an insurance company and want to give clients every opportunity to come in and see us well in advance of anything that might be coming this way,” he said.
“This appears to be a very large, well-formed storm that is moving in our general area. We don’t want to be alarmist, we just want to prepare for the worst and hope for the best.”
The company said it was writing travel insurance on a case-by-case basis.
Alan Peacock, president and CEO of Colonial Group Insurance, which has been busy throughout most of its operations in the Caribbean including the British Virgin, Turks and Caicos and the Bahamas where Irene recently passed through or close to, said: “Everyone is closely watching Katia and we have placed overseas loss adjusters on preliminary notice because our hurricane plan calls for additional adjusters to arrive ahead of the storm. In the event of a major storm, we are then well placed to provide a swift response.
“We started to look at this system a few days ago but it is still too early to say exactly which track the storm will take. We are planning to make a decision on Monday on the course of the storm.”
He urged residents to keep an eye on the latest developments to allow time to prepare for such an event and to make sure they get all of the necessary insurance in time.
“Katia has plenty of potential to strike Bermuda with major hurricane strength winds and I would encourage everyone to follow the course of the storm over the weekend to allow time for preparation, if required, on Monday and Tuesday,” he said.
“Any cover for next week including new home insurance should be purchased by tomorrow as we have a public holiday on Monday. The availability of travel insurance is not affected by the approach of the storm.”
BF&M president and CEO John Wight said: “The current tracking of Katia does cause concern for Bermuda and BF&M is watching it carefully. By weekend we will get a better sense of the direction of the system.
“However most models currently put it very near to us Wednesday or Thursday. Hopefully Katia will not cause distress for residents however planning and preparation is key to protecting treasured assets such as homes and boats.
“In 2003 residents did a great job preparing for the effects of Hurricane Fabian and while it is too early to discuss Katia in the same light, it is not too soon to start preparations.”
Mr Wight said there were a number of steps residents could make namely, being prepared by checking websites such as www.sharkoil.bm for advice on family plans and tracking the storm, and having the essential supplies to hand.
For those people who own a boat, he said that the mooring needed to be checked annually to make sure it was safe, and to ensure that the boat was secure if it was going to be left in the water on the mooring.
He added that the company’s travel insurance policies did not cover for weather delays or cancellations.
John Doherty, executive vice-president, property and casualty, at the Argus Group, said: “At the start of every hurricane season we review our hurricane plan and update it as necessary. As a potential hurricane approaches the island, we activate the plan.
“This includes bringing a loss adjuster to the Island if we expect there to be major damage and organising the team to be on-site. This allows us to respond to our clients quickly following a hurricane. If necessary, we bring in team members from other departments in the company to support us.
“Each storm is different and we assess the risk as it approaches. We often reach out to our clients to support their hurricane readiness plans and work as a trusted partner with our commercial clients.”
Mr Doherty also commented on the company’s approach in dealing with people seeking to buy insurance when a storm is apparently approaching.
“In order to ensure fairness to our existing customers, some of whom have been with us for many years, part of the plan may include applying underwriting restrictions to any new policies that people may wish to purchase within a few days of an approaching hurricane,” Mr Doherty said.
“This could include increased premiums, increased deductibles or temporarily stop writing business until after the threat has passed. I suspect any prudent insurer will operate like this in the lead up to a hurricane or major catastrophe.
“In order to keep our premiums at reasonable levels, we share the risk among our clients. If a large number of uninsured people wish to purchase insurance at the last minute because of the increased risk of loss due to an approaching hurricane, we feel it’s unfair for existing policy holders to share this risk with new customers as the existing policy holders may have to bear the brunt of possible increased premiums in the future if there are a large amount of claims.
“We keep our books open for as long as possible, however, we encourage people not to wait until the last minute to try and purchase insurance. If anyone is thinking about purchasing marine, home or contents insurance in advance of Hurricane Katia, we encourage them to come in and see us shortly.”
Freisenbruch-Meyer Group’s offices will be open on Monday between 9am and 5pm. For more information contact 296-3600, e-mail info[AT]fmgroup.bm, visit the website at www.fmgroup.bm, or join its Facebook page for daily updates.