Happy New Year from USAA – company dropping wind coverage for policyholders on the Coast

Yesterday’s Sun Herald reported USAA”s New Year’s greeting – Anita Lee had the story:

USAA, the property insurance company for active military and military retirees, plans to discontinue wind and hail coverage for at least 1,150 Coast policyholders, the Mississippi Insurance Department confirmed Wednesday.

A 45-year policyholder with USAA alerted the Sun Herald that the insurance company had notified him by mail his wind and hail would be discontinued when his policy expires in late February.

John Wells of MID said he called USAA and confirmed coverage would be dropped for some Coast customers after two policyholders called him. Wells said both customers who called him were within 1,000 feet of the waterfront. The boundary for wind and hail cutoff was unclear, Wells said.

USAA did not immediately return telephone calls from the Sun Herald about the notifications to policyholders.

Insurance Commissioner Mike Chaney said MID is working with a couple of companies interested in entering the Coast insurance market, including one company that would write wind policies.

Reader comments were insightful:

In 2005, I had been a USAA customer for 49 years! When I called and told the claim dept that my home was completely gone to the ground, I was told that I would be getting a full 100% policy payment (well into 6 figures) We didn’t hear anything for several weeks, and since we were too busy trying to find stuff and recover, we didn’t think to call back. When we realized we didn’t have a mailbox anymore,we again called to let them know we hadn’t received a check or seen an adjuster. That is when we were told that they had not and would not send an adjuster as they had determined, apparently from a internet map, that it was all surge and we were not covered. We got nothing, zero, natta. Tried to sue and lost as a clause in the policy exempted surge. We wern’t in a flood zone so if it wasn’t for the grant, I don’t know what we would have done. Thanks to the Miss Grant program.

SLABBED add a “we-told-you-so” to this an other comments showing there were policyholders on the Coast denied coverage without consideration of the wind damage that preceeded the flood waters of Hurricane Katrina – and the government picked up the tab!

3 thoughts on “Happy New Year from USAA – company dropping wind coverage for policyholders on the Coast”

  1. In looking at them online, it seems as though the scuttle-but within their military customer base is that they are living off their past reputation for good service. Some discussion as to the fact that they may be getting out of the P&c home insurance business all together.

  2. Also –
    Florida Insurance Q&A

    Posted:04/11/2007

    Due to the current state of the Florida insurance market, USAA is taking the following actions in order to limit potential future losses, and to protect the association and its members.

    USAA will only provide new homeowner or renter insurance policies for the primary residences of active military members required to move to the state pursuant to military orders.
    If your primary residence is in Florida and insured by USAA, USAA will continue to underwrite your existing homeowner or renter policy.
    If your primary residence is located outside of Florida and insured by USAA, USAA will continue to underwrite one existing homeowner, fire, or renter policy in Florida.
    Property insurance policies in Florida in excess of those cited above will be non-renewed upon written notice from USAA and in accordance with Florida’s laws and regulations. We expect this change to affect about 10 percent of our 270,000 Florida members.

    We are active military and have been stationed in FL on official orders (from Colorado). We found a house and called to inquire about homeowners insurance, to which we were denied. The house was deemed “high risk: sinkhole.” Now, I pulled up the geological survey, which is from what I understand, the most reliable in reporting sinkholes for areas. USAA said there was a sinkhole within a mile of the home in the last 20 years. Not that I want a home that is at risk of dropping into a sinkhole, but – point is, I did not find a reported sinkhole on that map within a mile. I called back to speak to another agent about this, more curious of their policies/regulations regarding sinkholes so that we (new to the area) could potentially avoid this – after all, Florida certainly wasn’t our first choice of moves! I got an agent who was willing to work with me, trying to assure me that USAA does in fact insure homes in Tampa (but not Brandon/Riverview/Lithia where we were looking). He asked me if I had any other addresses to try – so I gave him a couple – one about 5 miles away from MacDill AFB and the other – MacDill AFB! Both locations were denied because they were “high risk: sinkhole”. So you’re saying that if we are stationed at MacDill and they will insure active military on official orders but the base itself they wouldn’t ever insure (work with me here) because it is “high risk”. The agent was a little stumped, so he put me on hold saying he wanted to get the address of his co-worker sitting next to him (who also lived in Tampa). Sure enough, he put in her address and it was also considered high risk – DENIED! Lastly, trying to prove to me that USAA will insure homeowners policies for active military sent to FL on official orders (specifically Hillsborough County), he suggested we look for homes in New Tampa area, where the USAA building is located. The agent checked the address for the USAA building in Tampa and guess what…DENIED!! So you’re telling me that USAA built their own company on grounds that they consider high risk for sinkholes?! How’s that for irony? Sigh. On base housing is looking better and better…if only there werent a nine month wait…

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