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Life Health > Life Insurance

Gulf Coast Insurers Recover From Katrina

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Life insurers do not appear to be receiving significant numbers of Hurricane Katrina-related life and health claims, but some Gulf Coast carriers are still recovering from the effects of the Aug. 29 storm on their own operations.[@@]

Southern Farm Bureau Life Insurance Company, Jackson, Miss., for example, is using a generator to supply power, and a number of insurers from outside the region have posted requests on the Web for employees in the region to call headquarters.

The storm has been especially hard on Pan-American Life Insurance Company, a company known for its spectacular headquarters on Poydras Street in New Orleans, about a mile from the Superdome.

So far, Pan-American has been able to contact only 150 of its 450 home office employees, says Tom Richert, the company’s marketing director.

The generators in Pan-American’s 28-story building went down almost immediately during the storm, and the wind blew windows out on the top floor.

The water near the Pan-Am building has been about 2 feet deep, Richert says.

Several of Pan-American’s property managers stayed in the neighboring Intercontinental Hotel until the day after the storm, but, at that point, senior management ordered the property managers to leave because “the looting was getting out of hand,” Richert says.

Pan-American is trying to arrange an effort to send in trucks to get important legal, marketing, underwriting and human resources records from its headquarters, but the company has put its recovery plan into operation, and it is up and running, Richert says.

Pan-American has leased temporary space in Baton Rouge, 70 miles west of New Orleans. The company is paying claims, writing new business, and “returning to as much normalcy as we can,” Richert says.

Pan-American already is offering a 60-day grace period on payments to the areas hit hardest by Katrina. Southern Farm Bureau probably will offer a 60-day grace period, too, says company spokeswoman Linda Showah.

The life and accident claims picture remains murky.

Representatives for the Life Insurers Council, Atlanta, and the National Alliance of Life Companies, Sarasota, Fla., groups that represent some of the small and midsize insurers that were active along the Gulf Coast, say it is too early to know what kinds of life and accident claims Katrina will cause.

For now, with lines of communication down and efforts to relocate citizens continuing, life insurers are focusing on supporting relief efforts, and few, if any, storm-related claims are coming in, says Jeff Hasty, an LIC spokesman.

M. Lynn Lowe, executive vice president of Life Insurance Company of Alabama, Gaston, Ala., says he believes his company has not yet received claims because of Katrina’s effects on lines of communication.

Representatives from Pan-American, Southern Farm Bureau and 2 other life insurers, Guarantee Trust Life Insurance Company, Glenview, Ill., and Homesteaders Life Insurance Company, Des Moines, Iowa, say the incidence of claims has also been normal at their companies.

The companies emphasize that they have large, diversified pools of insureds.

Pan-American, for example, has business spread across 42 states and 7 Latin American countries, Richert says.

In related news:

- Katrina prompted the relocation of NALC’s fall conference to Longboat Key, Fla., from Point Clear, Ala. The conference is scheduled to start Sept. 28.

Commissioners Walter A. Bell of Alabama and J. Robert Wooley of Louisiana are scheduled speakers.

- Bell, Mississippi Insurance Commissioner George Dale, and Wooley plan to meet Wednesday in Atlanta for a “summit” that will give insurers guidance about how regulators expect them to evaluate property damage from Katrina.


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