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Published Friday, February 17, 2012 in Local

Insurance costs on homes are going up

By WALTER C. JONES

Morris News Service

ATLANTA -- Insurance companies aren't avoiding Georgia's coast, but they are raising prices there and across the whole state for homeowners policies, according to data the Georgia Insurance Department gave the Coastal Caucus Wednesday morning.

"We've got one problem that we're all facing, and that is rising costs and lack of access," said Insurance Commissioner Ralph Hudgens.

To prevent illegal "redlining" of coastal addresses, he said his office compares the market share of a company in the coastal counties to its share of business in the rest of the state. When companies seek rate increases, he takes a dim view of companies that don't serve homeowners equally around Georgia.

Insurance Department figures show that most homeowners insurers are marketing equally around the state. They're raising their premiums because they haven't made much money recently. Only two of the last 10 have produced underwriting profits statewide, according to figures the department gave the caucus.

"I don't know a company out there that won't go out and write some policies if they think they can make some money," said Steve Mangers, director of the Insurance Product Review Division.

Tornadoes and hail storms far from the coast were mainly responsible for the underwriting losses, he said. Those losses, combined with the potential for major risk on the coast, have made companies shy across the state.

Rep. Al Williams, D-Midway, complained that rising premiums in the Hinesville area were devastating to the middle-class retirees living there.

"Taxes caused a lot of people to consider selling their homes," he said. "Now, insurance is forcing them to sell. That's not fair."

Still, premiums along the Georgia coast that might be $1,800 per year would be $5,000 for the same house in Florida, Manders said.

The Insurance Department is considering ways to make it easier for homeowners, such as allowing higher deductibles for windstorm or roof coverage with special tax-exempt savings accounts to meet the deductible. Neighboring states are asking Georgia to participate in a regional, high-risk pool, but that may not be attractive because no major hurricanes have struck the state in a century while surrounding states are frequent targets.

Hudgens suggested the caucus resurrect a bill he sponsored as chairman of the Senate Insurance Committee before his election as commissioner in 2010. It would reward companies who market equally across the state with a discount on their annual assessment to the state's high-risk pool and raises the assessments of those that avoid taking on coastal customers.

"That bill, I'd be glad to share it with you," he said.

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4/29/2012