Insurers pay out $1.13B for Joplin tornado damage

JOPLIN, Mo. (AP) — Insurance companies have paid out $1.13 billion in claims from the Joplin tornado, and that’s expected to climb to as much as $1.9 billion, the state’s insurance department director said.

An estimated 7,500 homes were destroyed in the May 22 storm that wiped out about one-third of the community and killed 161 people. John Huff, director of the Missouri Department of Insurance, Financial Institutions and Professional Registration, praised insurers for their timely payouts, which he called essential to the city’s rebuilding.

“This is the largest insurance event in Missouri history,” Huff said. “The industry should be commended for the response thus far. Within 100 days after the event, they had paid out $1 billion. That is significant when total insured losses could be $1.8 billion to $1.9 billion.”

The Joplin Globe (http://bit.ly/vhCy32) reported the numbers do not reflect uninsured losses or properties that are underinsured. Officials have estimated as much as 40 percent of the homes in some neighborhoods in the tornado-damaged zone either lacked insurance or were underinsured.

Huff said the biggest losses for storm victims were on the commercial side, where only 55 percent of claims have been covered so far. That compares with nearly 85 percent for residential property and nearly 92 percent for automobiles.

He said commercial claims take longer to resolve because of the types of insurance and coverage options some businesses purchased.

“On the personal line, which includes residential and auto, we are where we need to be in those areas,” Huff said.

He said his department had received 1,036 consumer inquiries in connection with the tornado, and many of them have been complaints. Others seek guidance, policy interpretation and general information.

“Sometimes, those calls turn into complaints,” he said. “We help them set up their complaint and then do the mediation. A better number to look at is the $2.5 million in recovery we have helped consumers receive. That is a high number out of a billion dollars paid. We get a great deal of satisfaction from that.”

Huff said his department has the technological capability to analyze all of its data for trends in market conduct, consumer affairs and individual complaints. He said the department sent a signal early on that there “will be heavy regulatory oversight of the whole process.”

The companies with the largest liability in homeowner claims in Joplin are State Farm, American Family, Shelter, AAA and Travelers, the department said.

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Information from: The Joplin Globe, http://www.joplinglobe.com

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