2009-07-03 / Columnists

It's My Turn

The Drinks Are On Us
By Joan Mettler

Let us say you own a house in Rockaway. Let us say you have insured your home through the same agent with the same company since you moved here, twenty or more years ago. Let us say you were so delighted with your agent's service that you not only insure your house with him, you insured your business, your cars and yes, even your life, all with this man who you could trust like a good neighbor. He was your rock; and, you thought he was on your side. To prove it, he got you a multiple package discount. You were content. Would that this insurance saga ended as do all fairy tales, happily ever after. Alas, not. This one ends with anger and outrage.

Imagine how Rockaway homeowners feel when they are dropped by insurance companies after having paid their homeowners' premiums loyally without filing any claims (for fear of getting dropped or their premiums raised) for twenty, thirty or more years. This is exactly what is currently happening to two homeowners on our peninsula. Why, one might ask, are Liberty Mutual, State Farm and Allstate cutting and running especially after the alleged good will established by Rockaway's dutifully paying home owners?

If you have read the news, it seems that some sort of cataclysmic flood event is predicted for Manhattan, our peninsula and other low-lying areas in the City within the next five years. And, insurance companies apparently do not wish to stick around and help us in our time of need. This scenario gives new meaning to 'bail out.' Let it be known, they are bailing out for one reason: because they can.

Keep in mind that Liberty Mutual, State Farm and Allstate were allowed to take our money when no mass threat to our property loomed. In fact, for years, nobody gave procurement of homeowners' insurance a second thought. Our agents welcomed our premiums and we paid them, adding on an occasional policy for wind at which we first balked, then, sheepishly paid.

On the heels of wind, was the umbrella policy promoted for sale to homeowners in these times of multi-million dollar litigations. We thought the umbrella necessary and inexpensive at under $300 a year; and we paid it. And, the insurance company's books were happy as were their stockholders.

Suddenly, out of nowhere, companies that have provided us with homeowners insurance, are dropping us like the proverbial hot potato (no e). Who allowed this to happen? Would you be surprised if the answer is, our elected officials? How did they do this? Our electees established a statewide property owners' insurance company to pick us up after having been dropped by big named companies. Who is funding this insurance company, New York Property Insurance Underwriting Association (NYPIUA)? Albany is, from our tax dollars. We are.

Those homeowners who have been dropped and are now scrambling around for insurance have found NYPIUA as their new policy holder. Fire and vandalism only. The cost of homeowners' is similar in amount to what Liberty Mutual and Allstate charged: however, the coverage is not. For full coverage a homeowner would be forced to pay for a wrap-around policy at additional expense. One shudders to think what will happen when we are all forced to go with NYPIUA and a catastrophe ensues. Katie bar the NYS tax door, the funding is on us.

How can those dropped from homeowners' insurance protest? A letter can be written to our representatives and state senators in Albany demanding that companies redlining certain locations for fear they might actually have to pay off, should be charged an initial hefty fine followed by a multiyear penalty equivalent to the number of years they held each dropped policy. The sum of the two should be deposited into the NYPIUA fund to help NYS taxpayers finance our fund. Furthermore, if dropped homeowners truly feel aggrieved, no one could blame them for taking their auto, umbrella and business insurance elsewhere.

Yes. Here we have been complaining about TARPs, subsidies and bail-outs for the banking industry when we have been bailing out insurance companies for years. How nice for them! As for us, with regard to private homeowners' insurance in Rockaway, the only good hands we are in are our own.

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