On Fri, 16 Feb 2007 17:04:01 -0600, Patriarch
wrote:

Frank Boettcher wrote in
:

snip

In the southern states many insurances companies are opting out
coverage of mold and mildew on home owners insurance. That stuff
lives on the wood inside walls in damp areas like bathrooms. It costs
a fortune to remediate.



Well that's better than opting out of all coverage. State Farm just
announced that, because of the untenable legal environment in
Mississippi, they will write no new policies. Started out just no
policies south of Interstate 10, but as of two days ago, statewide.

There's a couple of thoughts on that.

Usually, it's a means of applying political pressure on certain
regulatory and legal bodies to get certain measures passed.

In this case it is a State Attorney General, a U. S. Senator, A U. S.
district Representative trying to make political hay and "save" the
population. They are aligned with a very well known and successful
class action attorney. And we know whats in it for him.

There has already been one case ruled upon and in addition to settling
the claim, a two million dollar punitive award was given. Multiply
that by 10,000 and you begin to see the problem.

Each year I get a renewal notice on my policy and there is separate
page in the renewal package with a message in very large, bold face
type. It simply states that "your property is not covered from
damages due to rising water from any source no matter the nature and
cause of the rising water. Because of your location you are not
required to have federally subsidized flood insurance but it is
available if you feel you need it. The procedure for obtaining this
flood insurance is.......You should consider this risk and act
appropriately"

I don't have state farm HO but assume all insurers send out this
boilerplate message.

The rising water did the damage. The cases are based on the fact that
the "wind drove the water in" , or the damage was done before the
water got there.

Katrina was a tragedy of epic proportions. Many of my friends and
relatives were impacted as was I in a minor way (lost about $5K in
woodworking supplies and machinery that were remotely stored and not
covered because of the rising water. But I can assure you the answer
is not to litigate private companies out of the state which will only
limit competition and raise rates or deductibles that would make the
policy meaninless.

Frank

It irritates their policy holders, particularly newer ones. It really
irritates their agents, particularly the newer ones, who make much of
their income by selling policies.

They are a mutual company, owned, pretty much, by their policy holders.
If they cannot balance the risks, financially, across their base, they
have to adjust the base. Sometimes, not adding new policies is the way
they do it. They don't like it, either.

My dad was a State Farm Agent for 35 years. I've never been one, but
I've been their customer for longer than that.

Things will settle out. The Gulf Coast still is a long ways from
settled from the storms, and will be for a while. State Farm will be
back in the new policy game at some time, is my guess. They are in and
out in California, too.

8 years ago, I had to replace my wood shake roof, or find a new
insurance company. I'd only been their customer for 30 years or so at
that point. Stuff happens.

Patriarch