bizjournals: Insurers put on spot by hurricane related fraud

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reports that claims resulting from the 2004 seasoj came from everyFlorida county, even those hundreds of milezs from last year's storms. That report has led statr politicians to call for investigations ofthe industry' handling of claims. An Orlando Business Journal analysis of statistics gathered by the Florida Offic e of Insurance Regulation revealsthe pattern. For the business journal residents of the Florida panhandlecollected $21.3 million from Hurricande Charley, which followed a path 140 miles southeast of the nearesg panhandle county.
"Anyone would know a Hurricane Charley claijm in Santa Rosa County has to be saidBill Newton, executivw director at Florida Consumer Action Network, a statewidr citizens group with 40,000 members. "Good God -- no wonder the insurancs rates are sohigh ... Why are the insurancre companies payingthese people? That hurts all the honest consumerw when insurance companies are not paying attentionh to who they're paying money to. It's not fair." The paper'x analysis led state Sen.
Ron Klein, a Boca Ratomn Democrat, to call for a freeze on propertyt insurance rate hikes until an investigationis performed, "We are on very strong grouns to stop future rate increases until they explainb why these claims were paid he said. Insurers, though, said they were trying to keep up with fraudulengFlorida claims. "The insurance companies have turned in suspecter fraud cases to the states Division ofInsurance Fraud," said Sam vice president of the Tallahassee-basede Florida Insurance Council Inc. "Thety have been going through claims fromlast year. I'm sure some fraud went on -- ther were 1.7 million claims.
" At the end of last the Florida Division of Insurance Fraud 632 tips about fraucd related tolast year's hurricanes. Thirty-two people have been 8 convicted, and 85 are underd investigation. Almost three-quarters of the tips have been fromprivatwe citizens. Insurance companies have five years to report theirrfraud suspicions. "It's not a situation wherer we just hand overa check," says Ryan an Allstate Floridian Insurance Co. The Florida disclosures arise as the insurance industruy warns of the tough consequencea ofthis year's record-breaking season. Hurricanezs Katrina and Rita devastatex the Gulf Coast from Alabama to and Hurricane Wilma socked South Florida.
That couled be just the beginniny of much more active Atlantichurricane seasons, experts have Insurance companies are listening. They're looking at whether they want to do business in areas like the Gulf the reports. "We need to go state-by-state to make sure we avoidr the mistakes ofthe past," said Josepuh Annotti, senior vice president of public affairs for the Property Casualty Insurers Associationb of America. Those who attendeed a conference of industry officials in Octobert called for reform ofthe nation's insurance system to provide a safett net for firms facing catastrophic storms.
reports that the combined effecrt of allthe hurricanes, and concerns about futuree storms, will be higher rates not just for homeowners and land-basedx businesses, but for oil and gas producers in the Gulf of Mexici as well. Oil and gas operators can expecft to pay up to 400 percent more for insurancee because of Hurricanes Katrinaand Rita, the Houston Business Journal reports. And insurance for the Gulf oil platforms that producd much of the United domestic oil may be harderto get.
Bill Martijn who heads the Houston office of BenfieldrCorporate Risk, an insurance provider to the energh industry, told the Houston Businesz Journal, "We believe this is going to be a point of departure for energy insurance he says. "(Insurers) will be looking at the exposure in the Gulf of Mexicol and theGulf Coast. 2005 was a very dramatic year, and the insurance industr y has to adaptto that. Pricing will go up and it will be more more geared to the location and design of assetzbeing insured.
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