Maine insurers try to stay one step ahead of rate hikes related to weather and climate change

Sara Donnelly in Mainebiz: …“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 first started paying closer attention to climate change predictions in 2004, when, in one of the most active hurricane seasons in decades, eight hurricanes hit the U.S. coast, causing an estimated $25 billion in total damages.

….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 (unlike in Florida and Texas, for example, which have been so battered by hurricane damage legislators are scrambling to keep state-run coastal property insurance programs solvent), some Maine property insurers have modified premium prices and plan details along the coast, which is considered more vulnerable than inland areas to freak weather patterns like those associated with global warming, as well as to sea level rise.

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….

Maine Coast Near Bar Harbor, by Hermann Ottomar Herzog