DOI Examined the Top 25 Homeowners and the FAIR Plan to gauge their responses to consumer claims
Earlier this week, Commissioner Murphy unveiled a report prepared by the Division of Insurance and the State Rating Bureau entitled A Special Examination of Property and Casualty Insurer Claims Payment Practices. The study sought to examine, review, and evaluate the claims response as a result of the June 2011 tornadoes.
Here are the major highlights from the study:
- As of April 2, 2012, more than 98% of the 10,764 personal property claims associated with the tornadoes had been settled;
- Insurance companies paid out some $167.9 million dollars for damages done to automobiles, homes, and associated personal property.
- As of April 2, 2012, almost 96% of the 757 commercial property claims associated with the tornadoes had been settled;
- Insurance companies paid approximately $32.4 million dollars in damages to commercial vehicles and property.
In compiling the data for this report, the DOI asked the top 25 home insurance companies and the FAIR plan to provide the aggregate data for tornado-related claims for each month from June 1, 2011 until September 30, 2011. The DOI then asked for a ten percent sample of tornado-related claims submitted during the same dates but that had not been settled as of September 30, 2011.
As a result of this examination, the Division of Insurance says that while not all consumers have received relief, the vast majority or almost 98.3% of the claims associated with the 2011 tornadoes in Central and Western Massachusetts have been settled as of April 2, 2012. A total of $200 million (in excess of $167 million for personal property claims along with $32 million in commercial property claims) has been paid by insurance companies and the FAIR plan.
An in-depth look at the numbers
Personal Property Claims Data
There were a total of 10, 674 personal property claims filed with the top 25 home insurance companies and the FAIR plan after the June 2011 tornadoes. The following is a breakdown of those claims:
|
Number of Claims |
Damaged Property |
Average Claim Payment |
| 4,259 | Personal Automobiles | $3,783 |
| 6,493 | Homes | $25,784 |
| 12 | Other Personal Property | $12,764 |
Personal Property Claims Settlement Amounts, by Month
|
Month |
Claims Settled |
% of Total Claims |
Average Payment |
| June 2011 | 4,213 | 39.1% | $5,955 |
| July 2011 | 2,479 | 23.0% | $10,540 |
| August 2011 | 1,227 | 11.4% | $13,484 |
| September 2011 | 877 | 8.1% | $26,890 |
Unsettled Claims
The Division says that a total of 158 claims were identified as unsettled as of September 2011 including 18 personal automobile claims and 140 home insurance claims. As of January 2011, 14 of the remaining unsettled personal automobile claims were resolved. In turn, of the 140 home insurance claims remaining unsettled as of September 30, 2011, 84 of those were settled by February 2, 2012 with an average payment of $38,555.
Commercial Property
The DOI says that a total of 757 commercial property claims were filed with the Top 25 home insurance companies and the FAIR plan. The following is a breakdown of those claims:
|
Number of Claims |
Damaged Property |
Average Claim Payment |
| 299 | Commercial Vehicles | $4,240 |
| 433 | Commercial Buildings | $73,049 |
| 25 | Other Commercial Property | $105,490 |
Commercial Property Settlement Claims Amounts, By Month
|
Month |
Claims Settled |
% of Total Claims |
Average Payment |
| June 2011 | 292 | 38.6% | $16,716 |
| July 2011 | 133 | 17.6% | $21,828 |
| August 2011 | 94 | 12.4% | $19,434 |
| September 2011 | 63 | 8.3% | $20,492 |
A total of 57 claims were identified as unsettled as of September 2011 including three automobile claims and 54 commercial building claims. As of February 2012, 31 of the claims had been settled with a payout of approximately $53,762.
Other articles from Agency Checklists that you might be interested in…..
Complaint Ratios for the Top 25 Homeowner’s Insurance Companies and the FAIR Plan
The Top 10 Homeowner’s Multi-Peril Insurance Companies in Massachusetts
