Declarations – East

Deductible Debate

“Many insurers don’t explicitly define the percentage of a replacement cost deductible as a ‘hurricane’ deductible. Rather, they use terms such as ‘wind speed’ or other nomenclature.”

—J. Robert Hunter, insurance director at the Consumer Federation of America, in his letter sent to government officials on Nov. 6. Hunter asked officials to monitor how insurers determine Sandy-related claims deductibles. Most Northeastern states declared that hurricane deductibles, which are usually higher than the flat-rate deductibles, wouldn’t be applicable for Sandy claims.

Down in Policy Counts

“I can tell you that from a risk management standpoint, we are down in policy counts in all of the affected areas by a reasonably substantial amount.”

—Allstate CEO Thomas Wilson on the company’s reduced exposure along the East Coast. He said this month that the insurer’s effort during the past five years to reduce exposure in places like New York and New Jersey may help lower Sandy-related losses.

100-Year Flood

“I told the President the other day: ‘We have a 100-year flood every two years now.'”

–N.Y. Gov. Andrew Cuomo on what he described as “a new reality” of extreme weather events. He told reporters after Sandy made landfall that anyone who doesn’t see a dramatic change in weather patterns is denying reality.

Manageable Exposure

“While this is a significant event for those who suffered losses, Storm Sandy is well within the planning scenarios we use to manage catastrophe risk at The Hartford. This is a major storm, but it is a manageable exposure for The Hartford.”

—The Hartford CEO Liam McGee on the insurer’s exposure to Sandy-related losses. McGee made the comment during the company’s Nov. 2 earnings call.