This all became clear after recent discussions with several agency principals, among them Gary Morris, CEO of Rampart Insurance in Lake Success, N.Y., and Joe Parisi, chairman and CEO of Otterstedt Insurance Agency in Englewood Cliffs, N.J. 

Both Joe and Gary had learned quite a bit from previous experience after Hurricane Irene defied most expectations. Needless to say, when Sandy reared, they were prepared and ready—on behalf of their employees and policyholders. Their experiences are worthwhile reminders to all agents in areas prone to natural disasters—and that is pretty much the entire U.S. these days—that planning for the worst and taking corrective actions is a necessary, if not vital, agency best practice.

Prudence in Prescience

A natural disaster triggers an avalanche of claims, but what if the agency is out of power when the claims roll in? What if employees cannot drive to the office because of severe damage to roads and other infrastructure? What if employees must attend to their own damage-related challenges at home?

Rampart Insurance was prepared for all these possibilities—just in case. “We had given everyone on the staff an 800-number to dial into a conference call if the electricity at the agency shut down or they couldn't make it in,” Gary Morris said. “We wanted everyone here to be ready to take in the claims wherever they could.”

Policyholders reporting a claim would call into the agency or their respective carriers, as is typical. However, if the agency were shuttered, a prerecorded message would advise the callers to phone an 800-number. The calls were then routed to the agency's staff at their homes—or wherever they might be. “Everyone, no matter their regular jobs, was ready to take down claims information,” Morris said. “We even recruited the help of a retired claims person, who had agreed to pitch in from his home.”

Prior to the storm's arrival, the staff convened a meeting to discuss preparations. The agency emailed each employee insurance company claims contacts for commercial lines and personal lines, contact information for damage restoration firms and a claim reporting form. 

“Any employee could now take down such information as the name of the insurer, the policy number, the location of the loss and the description of the damage,” Morris said.

Related: Read the article “Market to LGBT Community” also by Paul Morrissette.

On Monday morning, hours before the storm made landfall that night, the agency gave the staff the rest of the day off. More than 100 employees were ready at their homes for the onslaught of claims, in case the agency lost power the following day. “We told the staff not to forward any calls to the claims department, but to take down the information themselves—they now had the claim form,'” Morris said. “We were absolutely prepared.”

Fortunately, the agency maintained power, and nearly the entire staff was able to make it back to the office on Tuesday. The agency established a triage system, calling upon each employee to record claims information and put the completed form in one of two bins, one for personal lines and the other for commercial lines. Every five minutes, claims filled a bin, which was then hauled to six employees tasked with calling in the claims to the relevant carriers, by phone, fax or website. Three other employees manually entered the claims into the agency's client management system. As Morris put it, “We had all hands on deck—literally.”

The first week after the storm, the agency handled more than 2,000 claims. The storm's heavy impact on Long Island meant that new claims were reported throughout November as well. The agency's planning did not extend just to claims handling. Days before the storm struck on Oct. 29, the agency emailed every single policyholder a list of disaster preparedness tips, from inspecting gutters for debris to bracing outside furniture, to reduce the potential for damage. 

Sandy cast a wide swath of damage throughout the New York metropolitan area, and New Jersey's Otterstedt Insurance Agency showed similar prudence in assisting its clients. Three days before Sandy struck, the agency emailed a document, “The Protection of Your Family and Business is Our Mission” to thousands of Otterstedt policyholders. The document listed 10 risk mitigation tips, among them, “Secure Household Appliances,” “Prepare an Evacuation Plan,” “Test and Refuel Your Backup Generator” and “Have Your Insurance Policy Numbers and Insurance Company Claim Phone Number Handy.” 

The agency also emailed a link to policyholders through which they could download a mobile app to file and upload a claim. It urged policyholders who might lose electricity to contact the firm via its website, Facebook or Twitter. “We wanted them to have as many options as possible to report a claim quickly,” Joe Parisi said. “If you lose electricity, you can still charge your phone from your car. I had to do just that myself when I lost power at my home.”

The agency also posted risk mitigation tips on its Facebook page, in case customers had previously neglected to download the advice from their email accounts. “What we learned from Hurricane Irene and other storms is that communication is key—through whatever channels are available,” said Mike Barbara, the agency's senior vice president of personal lines. 

In Times of Trouble

Six of Otterstedt's seven New Jersey branches lost power. “Employees knew beforehand that if their branch was closed, they were to report to whichever ones remained open, and in this case it was our branch in Summit,” Parisi said. 

Related: Read another article on Hurricane Sandy “Chubb Puts $880M Price Tag on Sandy Losses.”

The entire staff of more than 100 employees took and reported claims. “Everyone was on claims duty; I personally handled 50 claims,” Barbara said. “Even our accounting manager, who knows little about homeowners' coverage, handled 20 claims. We had briefed her on how to do it well before the hurricane struck.” 

The agency's clients filed more than 1,600 claims in the first 2 weeks after Sandy made landfall, a significant percentage of which were paid within 2 weeks of reporting. Parisi is proud of his agency's performance, and joined Gary Morris in saying, “We were 100 percent prepared for this.”

Agencies across the country can learn from the practices of Rampart, Otterstedt and others who have faced natural catastrophes. With proper foresight, independent agents can be ready to help policyholders to report claims as quickly as possible at a time that insurance expertise is truly valued. 

When disaster strikes, customers expect to benefit from the personal service that can only be delivered by an independent insurance agent. In times of trouble, agents like Gary and Joe are preparing contingencies not just for their own businesses and families—but for their policyholders, too.