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The Coastal Packet

The longtime national journal, Progressive Review, has moved its headquarters from Washington DC to Freeport, Maine, where its editor, Sam Smith, has long ties. This is a local edition dealing with Maine news and progressive politics.

8/26/09

STORM INSURANCE CHANGING

Maine Biz - "The weather patterns of recent years have changed how the insurance companies are looking at their data," explains Chris Condon, president-elect of the Maine Insurance Agents Association and CEO of United Insurance, a Falmouth-based network of 12 insurance agencies in Maine. . . Condon says Maine insurers have since modified their risk models to consider whether a property is vulnerable to a catastrophic disaster over the next 500 years, rather than the previous industry standard of 100 years. Though Maine's catastrophic weather events remain relatively infrequent some Maine property insurers have modified premium prices and plan details along the coast. . .

Here in the Pine Tree State, insurers are more worried about ice storms than hurricanes. Here, too, coastal properties are the concern. In the ice storm of 1998, the sandy southern coastal counties of York and Cumberland, more vulnerable than the rocky northern coastline, were hit the hardest - nearly 3,200 of the 3,901 total insurance claims from that storm came from those two counties, accounting for $8.8 million of the $11.1 million in total ice storm-related losses to insurers in the state, according to the Maine Emergency Management Agency. . .

Condon points to one of MIAA's member companies that has since 2007 raised its rates 70% on coastal properties in York County, the county most damaged in the 1998 ice storm. Another company has changed its definition of coastal property, for which it charges higher rates, from within 1,000 feet from the coast to within 5,280 feet, or one mile. Another has added wind deductions, also known as hurricane insurance, that typically force a client to pay an average of 6% to 14% of the property value before the insurer will pay for damage from winds above 74 miles per hour. . .

Maine Mutual Group Insurance, or MMG, is the only property casualty insurance company covering Maine that also has its executive offices in state, in Presque Isle. . . . Because of reinsurance rates, MMG recently raised premiums in storm hotspots York and Cumberland counties between 7% and 10% on average, with some coastal properties seeing even sharper increases.

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