Coastal Homeowners from Texas to Maine Only Half-Prepared to Recover from Major Storm

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LA, MS, FL & GA homeowners have taken most steps, shows new Hurricane Readiness Index; New Englanders least prepared

WASHINGTON (July 6, 2006) – Average insured homeowners throughout Gulf and Atlantic coastal communities have taken just half the steps which would best position them to recover from a major storm, according to a new Hurricane Readiness Index released today. The Index is based on a survey which asked individuals whether they had taken eight key preparedness steps, including whether they have an inventory of their possessions, whether they feel they have enough homeowners or federal flood insurance, and whether they have critical documents ready to go in case of evacuation. The poll was taken for seven of the nation’s leading property and casualty insurance companies.

The survey-wide Index average is 48%. Respondents in coastal Louisiana topped the chart having taken 60% of the steps. Coastal Mississippi, Alabama and Georgia have taken 58%, while Floridians also fared better than the national average, with index numbers from 52 to 58%. Those in Connecticut, Maryland, New York, Massachusetts and Maine have taken only about one-third of the steps, with Index ratings from 36 to 39%.

“People who’ve heard weeks and months of talk about getting ready are getting the message, to a point,” said Dr. Bob Sheets, former director of the National Hurricane Center, who presented the poll results at a news conference in Washington today.

“Those who’ve been through hurricanes are naturally more ready than those who have not,” Sheets added. “But even people who live in historically hurricane-prone areas indicate they’ve taken only about half the steps needed to be ready to recover should a hurricane strike again. And too many folks up north just don’t want to believe a hurricane will hit them.”

“Hurricane forecasters say this could be a really fierce year up and down both the Gulf and Atlantic coasts,” he said. “Everyone needs to take these predictions very, very seriously and get their houses, their emergency plans and their insurance coverage in order now.”

Survey-wide, three-fourths of those with homeowners insurance say they know their policy does not cover flood damage, yet just under one-fourth say they have a separate federal flood insurance policy.

“It’s not too late to get ready,” said Jeanne Salvatore, Senior Vice President of the Insurance Information Institute (I.I.I.), “but it’s close. There is a 30-day waiting period for federal flood insurance to take effect. So homeowners need to call their agents now to make sure their coverage is up to date. There are also things people can do that don’t cost a thing – it’s just a matter of getting it done now, while there’s still time.”

The survey polled 4,200 respondents in Gulf and Atlantic coastal communities over two weeks in mid-June, with a margin of error on the survey-wide sample of +/- 1.5%. The Hurricane Readiness Index was compiled from answers to eight readiness questions, including:

“While much has been done by state and local organizations and governments, as well as individual insurers, we need to keep working to get the word out about hurricane preparedness,” said Dr. Sheets. “Homeowners fare better when houses are protected, people have plans and coverage matches the need. So the major insurers asked for this survey to help with awareness efforts.”

The poll sponsors are Allstate, the Hartford, Liberty Mutual, Nationwide, State Farm, Travelers and USAA.

Each company has ongoing education programs, as does the Insurance Information Institute, which today launched an updated consumer education Web site, www.disasterinformation.org. It provides readiness tips, helps assess appropriate levels of insurance, and provides free easy-to-use software to help homeowners inventory and document their possessions.

“We know getting ready and checking insurance coverage is complicated. We know making evacuation plans can be scary, and that it’s easier to just hope nothing will happen,” said the I.I.I.’s Jeanne Salvatore. “We all hope nothing happens this hurricane season, but our experience and our forecasts tell us otherwise.”

Salvatore added that the key steps to insurance readiness can be summarized in one word:

MUST.

Make an inventory of your personal possessions and their value.

Update your coverage to ensure you are protected against hurricane-related threats; to reflect improvements to your home’s structure; and to cover your personal possessions. Update or add federal flood insurance, as well.

Secure your home against storms by taking steps to prevent flood damage, protect your roof, and strengthen windows and doors.

Take important documents, including a copy of your insurance policy, your inventory and insurance company contact information with you if you evacuate; send copies now to friends or family who live elsewhere. Carry important papers in zip-to-lock plastic bags.

The full index and notes about the survey methodology appear below. More information can be found on www.disasterinformation.org.

Hurricane Readiness Index, ranked by homeowners score (scale of 0-100)

Questions in Index:

  1. Review Policy: When was the last time you reviewed your homeowners insurance policy, either by yourself or with your insurance agent?

  2. Update Policy: Have you updated your homeowners insurance policy in the past 5 years?

  3. Flood: Do you have a separate flood insurance policy?

  4. Right amount of coverage: In the event of a hurricane, do you think you have the right amount of insurance coverage, not enough insurance coverage, or aren’t you sure?

  5. Disaster plan: Develop a family disaster plan, including evacuation routes arrangements for any pets, and a disaster supply kit

  6. Hurricane improvements: Make repairs or improvements to make your home more structurally sound, such as hurricane-resistant windows, hurricane shutters, or reinforced garage doors

  7. Inventory: Create an inventory of the possessions in your home

  8. Store Documents: Store important documents such as insurance policy information and a claims contact number in a safe place away from your home

Methodology:

The Glover Park Group designed this survey, which was administered online by Stratalys Research from June 12–26, 2006. A sample of 4,200 adults in coastal counties located in hurricane-prone states was surveyed. The sample was evenly divided among 21 regions (200 coastal residents per region). Certain questions were only asked of coastal residents with a homeowners insurance policy (n=2,775). The overall margin of error is +/- 1.5%; the margin of error for each region is +/-6.9%; the margin of error for residents with a homeowners insurance policy is +/- 1.9%.

Respondents were drawn from web panels comprised of a combined 5.5 million individuals. A strict multi-step screening process was used to ensure that only qualified individuals participated in the survey. Regions were weighted slightly to match census data for gender, education, and age.

The Insurance Information Institute

The Insurance Information Institute is a non-profit, communications organization supported by the property/casualty insurance business. For more information visit http://www.iii.org.