Karen Bryant, along with her husband Mark, owns the All Premier Insurance Agency, an independent agency in Denham Springs, La., site of much flooding in recent weeks. In addition to helping her clients cope with the aftermath of the flooding, Bryant and her family are also flood survivors. Her single-story home had five feet of water in it, and it’s a total loss — a story similar to those of her clients.
“I think a flood is worse than a fire,” says Bryant. “With a fire, everything is destroyed, but with a flood, you can see what’s lost and damaged beyond repair. It looked as though a demon had been through my house, and it reminds us that we’re not really in control, as much as we’d like to think otherwise.”
Denham Springs is a community of about 10,000, within easy commuting distance of Baton Rouge and with a top 10 school district. As the Amite River rose, eventually reaching its record high of 46.2 feet, 90% of the town flooded, causing residents to evacuate in droves. Bryant was vacationing in Memphis, Tenn., when the waters began to pour in, and the first warning she received was from a client who called to let her know he would be filing a claim.
|Harrowing experience
Bryant’s drive home was a harrowing one, with the interstate flooded out in places. She and her husband watched the water at their house rise by 12 inches an hour. They then headed for her parents’ home, only to be followed by rising water everywhere she went to escape. “I felt as though the water was chasing us,” she recalls. She finally got her parents to safety, and her husband went out to join the volunteers with trucks and boats known as the “Cajun Navy.” Bryant didn’t hear from him for two days because cell service was unavailable in most areas.
For Bryant, the most disheartening thing is that so many of her clients didn’t have flood insurance. She has offered it to them, but most clients rejected the offer, noting that their properties had been reclassified into a low-risk flood zone. That reclassification made flood insurance optional, not mandatory, according to the banks that held their mortgages. “But this time, the low-risk areas flooded more than the higher risk ones where we traditionally see problems,” Bryant says. “It’s heartbreaking to have my clients say, ‘I should have taken your advice.’”
Amanda Burge looks at flood damage with two of her three children Aiden, right, and Hudson, left, at her home in Denham Springs, La., Aug. 19, 2016. (Photo AP/Michael Kunzelman)
|Not the same as Katrina
It’s impossible not to draw parallels to Hurricane Katrina and its aftermath, especially because many Baton Rouge area residents were Katrina survivors who evacuated to the area and chose not to return to New Orleans. They bought flood insurance, but that won’t go very far in restoring their possessions or their properties, Bryant observes.
This was a different event than Hurricane Katrina, explains Richie Clements, 2015 president of the National Association of Professional Insurance Agents (PIA), and head of his own agency. Clements, located in Chalmette, La., east of New Orleans, is a survivor of Katrina who understands well the issues Bryant and her fellow insurance agents are facing. He, too, handled endless claims for clients during Katrina while dealing with his own flooded home.
There are some positive aspects to the Baton Rouge flooding, Clements notes. “People can get back to their homes within days, not weeks or months, so they can begin the restoration process more quickly.”
Clements too finds that people who didn’t have flood insurance, especially those who rejected their agent’s offer, are resigned about their situation. “This was a pure flood event,” he explains. With Katrina, there might have been some coverage for wind damage. He is concerned that agents may face errors and omissions (E&O) claims because “There are always those people who want someone else to blame.” But as long as agents have maintained proper documentation that flood insurance was offered and rejected, they should be all right.
Adjusting companies and major carriers are better prepared after Katrina, Clements says. He also believes that they’re much more diligent after their experiences with Superstorm Sandy. He cautions that a major flooding event in Florida and along the East Coast as a result of Tropical Storm Hermine may slow down recovery in Louisiana as adjusters and claims professionals are diverted to other areas.
Related: The Rising: PIA President Richie Clements’ personal & professional resurrection, post-Katrina
|Thousands of cars totaled
The National Insurance Crime Bureau (NICB) estimates that approximately 100,000 insured motor vehicles have been damaged, but there are no clear estimates for the number of uninsured vehicles affected. Several car dealers in the area also found their businesses under water, increasing the number of flooded vehicles.
Clements reminds agents to have their clients verify that any replacement vehicles were not flood damaged. NCIB notes that consumers and agents can check a vehicle’s history through the NICB’s VINCheck and the National Motor Vehicle Title Information System (NMVTIS) as well as their state motor vehicle records.
“This is the eighth catastrophic flooding event in the U.S. this year,” Clements notes, “and we don’t know about the effects of Hurricane Hermine.” His advice? “If there’s water anywhere nearby, you need flood insurance.”
Denham Springs High School football coach Dru Nettles talks to his team at the start of the team’s first practice after the flood in Denham Springs, La., Aug. 24, 2016. “If you look at the back of the campus, the one thing that didn’t go underwater was this logo,” Nettles said. “Awesome sign right there that this ‘DS’ was shining ... to give people hope.’ (Photo AP/Max Becherer)
|How the state is helping
Louisiana Insurance Commissioner James J. Donelon issued an emergency rule, which applies to all types of insurance and is in effect until Sept. 10, 2016. It’s similar to the rules issued by the department after Hurricane Gustav in 2008 and Hurricane Isaac in 2012:
- Policyholders living in parishes that receive a major disaster declaration from the federal government will have until Sept. 10 to pay insurance premiums due on or after Aug. 12, 2016, without any late fees, penalties, cancellation or non-renewal.
- Policyholders in affected areas also have additional time to submit documents to insurers for claims that were filed before the state of emergency but that might be difficult to obtain until they can return to their homes and businesses.
- Under the rule insurers can’t cancel or terminate policies due to the inability of policyholders in federally declared disaster areas to comply with policy provisions, for example, occupying dwellings.
- The rule doesn’t apply to policyholders who live in areas outside the parishes included in the federal disaster declaration.
Lost sense of community
As devastating as it is for homeowners, more “gut-wrenching,” is the loss of the town’s infrastructure, Bryant says, which will make it more difficult to get back to what she and her clients are describing as the “new normal.” The floods hit everywhere: churches, schools, City Hall, stores, restaurants, the post office and even the local jail, displacing 600 inmates.
“We need to get the town up and running as soon as possible so we can restore our sense of community,” Bryant says.
The surrounding towns are coming together to help as best they can, she notes: Schools that didn’t flood are running two shifts, with the school day for some students starting at 6:15 a.m. and running until 1:30 p.m. The second shift goes from 1:30 p.m. to 6:00 p.m., which has raised some daycare issues, she notes, especially for teachers.
“But we hug each other, look for the positive, and go on. We stay strong because we have to.”
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Rosalie Donlon
Rosalie Donlon is the editor in chief of ALM's insurance and tax publications, including NU Property & Casualty magazine and NU PropertyCasualty360.com. You can contact her at [email protected].
