Ah, April! Spring is in the air and the world is renewed! Sure, we had to get through summer, fall and winter to get here. But on a clear, fresh morning, hope springs eternal once again!
Wouldn't it be great if the insurance world had such a season? We need one. True, we have our good days and bad, but for quite a few years now–at least in relationships with our clients-winter has been seriously eating into spring. And judging from a recent CNBC Business Nation article (originally posted on March 3, 2008 and located at press time at www.msnbc.msn.com/id/23409995), the chill is only settling deeper into our bones.Please understand I'm not assuming CNBC has no bias, or that every opinion expressed has the ring of biblical truth. What we should focus on is the consumers' tone of voice, contrasted with the responses from industry spokespersons.For example, one homeowner quoted in the article is clearly upset about the settlement her insurance company offered her after a loss. Her comments appear in the context of how frequently the issue of underinsurance arises following catastrophes. I've written about this repeatedly over the years. Whether the cause was Hurricanes Andrew and Katrina, California wildfires and earthquakes, or Midwest tornadoes and hailstorms-you name the catastrophe, homeowners (and commercial risks) are underinsured.The quote begins with an assertion from Robert Hunter, insurance director for the Consumer Federation of America:
| Hunter estimates as many as half of American homeowners don't have adequate insurance. And while the industry says that's usually the fault of homeowners not keeping their policies up to date, that doesn't explain the case of Karen Reimus. Not only did the company refuse to pay her policy limit, but it turned out the limit itself was too low."We had a brand new policy," she said. "And not only did we have extended replacement, we bought the earthquake rider. I mean, we did everything we possibly could to be properly insured."CNBC: So when the insurance industry says that this whole issue of underinsurance is really the insured's fault, what does your experience tell you about that?Reimus: I didn't pick the number on the policy, they did. They used their cost valuation software, their program, and they came up with a number. You know, when I go to the dentist I don't say, "Oh, are you sure that's a cavity?" I went to an insurance professional. … I thought, "OK, they know what they're doing." |
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