Insurance rates have doubled, tripled for most
10:06 AM CDT on Monday, July 31, 2006
Jeremy Shapiro / Houma Courier
HOUMA -- When insurance rates triple but your income remains the same, something has to give.
Whether facing a price increase on a homeowners policy renewal or buying a new policy with the state Citizens plan, local residents are having to figure out how they will afford insurance. That may mean taking a new job, refinancing a car, postponing a vacation or even going without insurance.
Nikki Bush, an east-Houma resident, was notified in May that Farm Bureau would drop her wind and hail coverage July 1. That started a crazy two-month search for how to insure her family’s Village East home. Bush said her original policy cost $690 a year.
A policy with the Citizens plan, a state-run program considered an insurer of last resort, cost $1,200 a year, so she opted for that. But there were several problems. First, Citizens wouldn’t insure the trampoline Bush had bought her kids as a present last Christmas. She would have to get separate coverage elsewhere just for the trampoline.
Second, Citizens needed a down payment of $400. Bush said she and her husband didn’t have the money, so they had to refinance their truck.
Affordable insurance a thing of the past for most
Then word came from their insurance agent that Citizens wouldn’t write them a policy because the $95,000 policy they were seeking wasn’t sufficient to cover their home and belongings. The couple needed at least $102,000 worth of coverage, Citizens told them. The cost to insure that amount was $1,500 a year Asked how she will cope with the extra expense, Bush said she didn’t know. A substitute teacher, Bush may look for a job with a more-regular pay-check. She said her husband may have to put in more hours. The couple had taken time off to coach youth softball, but Bush said they may not be able to afford to do so in the future.
Debra Anderson of Chauvin said insurance will force her to get a job, and she’s considering moving to another state to escape the high cost.
Anderson and her huband’s homeowners insurance went from $1,500 to $4,000 this year. Her first payment of $1,600 is due Aug. 1. So Anderson, 54, will be hurriedly job searching.
"I had planned on being a domestic goddess the rest of my life," Anderson said. "Now, I have no choice but to go back to work."
Anderson said her insurer, Lexington Insurance, did not renew her policy and claims the company didn’t bother to tell her that fact. After she found out the coverage ran out, she had to enroll in the state plan.
"They are killing us," Anderson said of insurance companies. "It will force us to move somewhere it doesn’t cost so much."
Loretta Henry refers to her insurance situation as highway robbery. After suffering foundation damage in her mobile home next to the Montegut Levee during Hurricane Rita, Henry decided it was time to move north to Chauvin.
She and her family bought a house on 2 acres of property. Wanting to protect their investment, they looked for insurance but found no company that would offer her a policy. She had to turn to the state plan.
For $250,000 worth of coverage, the cost was $8,600 a year. Henry, a small-business owner, couldn’t afford it. She was forced to limit coverage to $130,000 and jack up her deductible to $6,500. That lowered the cost to a more-manageable $3,000 a year.
While the area around their new home remained dry for Rita, Henry said not having insurance is not an option.
But for some local residents, there is no other alternative.
Rosemary LaFleur said she and her husband had to decline renewing with State Farm after the price went from $388 to $800 a year. LaFleur made a claim after Rita, but she said the money she received did not cover the damage’s entire cost.
LaFleur said she and her husband are cancer patients who live on a fixed income.
"So, needless to say, we have no insurance now," she said, "and we’re worried about hurricane season."