Rhode Island Insurance

It is 1200 km from the coast, where Hurricane Katrina touched land two years ago at the Annual colonial-style home here, where James Gray, a retired public relations consultant, and his wife, Ann, live. But this summer, Katrina reached also in the form of a cancellation letter from their home insurance company.

The letter said that “hurricane events in the last two years”, the company had forced their exposure to further losses and that, because the Grays’ home in Long Iceland was near the Atlantic Ocean - it is 12 miles from the coast and has been touched by raging waters only once, if the above bathtub overflowed - her 30-year-old policy was “nonrenewed or canceled.

The Grays, with a new company, but their case to the attention of the consumer advocate and, in turn, the New York Insurance Commissioner, Eric R. Dinallo.

Mr Dinallo’s sharp reprimand last month of the Grays’ company, Liberty Mutual Fire Insurance Company, which is a shift of public officials, as a new reality in the homeowners’ insurance business, lawyers say.

In the past three years, more than three million property owners have received letters like the Grays, such as insurance companies, determined to avoid another $ 40 billion Katrina bill, have essentially begun to redraw the overview of the eastern United States somewhere west of the Appalachian Trail.

Officials in southern states from Florida to Texas have been fighting for insurance carriers year, rising prices and withdrawal of services, but officials in the North East have only recently joined The Fray.

Companies such as Allstate, State Farm Mutual and freedom, “nonrenewed” policy not only in the hurricane-battered places such as Florida and Louisiana, but in New York and other northern states which have not yet seen hurricanes in years. Since last year, Allstate has all new homeowners’ insurance business in New Jersey, Connecticut, Rhode Iceland, Maryland, Massachusetts, and the eight downstate counties in New York.

An independent insurance agents’ group, the Grays from about 50000 inhabitants of the New York Metropolitan area - and about one million property owners in the Mid-Atlantic and New England states - whose policies have been canceled since 2004. While most homeowners were in able to cover with other major insurers, or smaller companies, in most cases, it is at higher prices and larger deductibles.

The companies say that they are obliged to avoid undue risk when they see it, and to remain solvent. “Taking into account what happened from 2003 to 2005,” said Robert P. Hartwig, chairman of the Insurance Information Institute Committee, a lobby group of industry, “and considering that the best meteorological heads tell us that for the next 15 to 20 years of hurricane activity is heavier than normal, if we do not do something to reduce our exposure, we would be out of business. ”

In response to a growing flood of complaints, state officials and legislators have recently begun to push back, if gently against the industry, which they consider to be exaggerated to the hurricane threat in the northeast. “My concern is that this situation will be manipulated by the insurance companies, in order for them to get higher prices,” said State Senator Kenneth P. Lavalle, calls for the cancellation of the policy in its eastern city of Long Iceland “more than a problem — it is a crisis. ”

Mr Dinallo, the Commissioner, has turned his attention to the law: It was a single line in the Liberty Mutual letter to the Grays, prompted him to blame his problems. The line should be noted that a drop consideration in its policy was that they do not have car insurance with the company.

That, Mr Dinallo said, is illegal. Prediction of a policy on another, or so-called “Tie-in the economy,” constitutes a violation of state insurance law, he said. Liberty Mutual, said the tie-in is a secondary issue, but as a response to Mr Dinallo’s warning, Liberty Mutual and the largest insurer in the state, Allstate agreed to the practice.

At the beginning of this year, Richard Blumenthal, the Attorney General Connecticut, also challenged insurance offices tactics, subpoenaing records from nine insurance companies, the home owners to install storm shutters, if they wanted their policies. “The insurance companies make record profits,” said Blumenthal, said in an interview, “and the dire forecasts of devastating hurricanes, fortunately, were very wrong - fortunately for all, including the insurer.”

Meanwhile, heated public hearings were held this year in the Rhode Iceland General Assembly on the lack of homeowners’ insurance in coastal areas, which include most of the state.