Hurricane Sandy makes landfall and insurers scramble to mitigate impact
Hurricane Sandy has hit the East Coast of the U.S. after building in strength throughout the majority of the past week. U.S. Insurers have been working to prepare for the hurricane, which is expected to cause a significant amount of damage as it passes through densely populated cities in the northeastern region of the country. Claims teams and insurance adjusters have been mobilized to areas that are expected to see the most damage ahead of the storm in an attempt to ensure victims receive the service they need from their insurer.
Travelers institutes continuity plan to ensure business continues
Travelers, the third largest property and auto insurance company in New York, is one of those that is prepared to face Hurricane Sandy. Spokesman Matthew Bordonaro notes that insurers often prepare for these disasters ahead of time to ensure that the impact of catastrophes is mitigated to some degree. Travelers has initiated a continuity plan that will ensure that it can continue operations despite the fact that a significant amount of its workforce has been sent to high-risk areas in New York to manage the impact of Hurricane Sandy.
Eqecat does not consider Hurricane Sandy to be a major loss event
Eqecat, a leading catastrophe risk modeling firm, suggests that Hurricane Sandy is powerful and has potential to cause significant damage. Despite the strength of the storm, however, Eqecat does not expect it to be a major loss event. especially considering the fact that insurers have had a relatively calm year to bolster their financial defenses against a major natural disaster.
Financial impact of storm may cause problems for National Flood Insurance Program
Insurers are prepared to address many of the issues that arise from Hurricane Sandy, with the possible exception of flood damage. Managing flood damage and claims will largely rest with FEMA and the National Flood Insurance Program. The federal program accounts for the vast majority of flood insurance policies throughout the country, but has been crippled by serious financial problems. If Hurricane Sandy can be considered a catastrophic disaster for any insurance group, it may be doubly so for the National Flood Insurance Program.