Alabama beach pool report cites changes made after Hurricane Ivan

Originally published by the Mobile Press Register

Alterations follow recommendations from gubernatorial panel three years ago.

Friday, September 05, 2008 By RYAN DEZEMBERStaff Reporter

FOLEY — The state's insurer of last resort, the Alabama Insurance Underwriting Association, this week released a report that chronicles the changes it has undergone in response to recommendations made by a gubernatorial task force three years ago following Hurricane Ivan.

Known as the "beach pool," the Foley-based association offers wind insurance in coastal areas to those who can't find coverage in the private market. In essence, the beach pool forces insurers that do business elsewhere in the state to share in property risks in Mobile and Baldwin counties.

As of July, the beach pool insured nearly 10,000 properties and had a total exposure of about $1.7 billion.

Some of the changes — adding two citizen members to its board of directors, and increasing the available coverage to $500,000 per property — were made last year. But other changes have been more recent, including establishing a system of discounts for homeowners who build or upgrade their properties to withstand stronger storms.

Bob Groves, the association's secretary/manager, said in a news release that the changes have "enhanced our ability to provide coverage."

Owners of new homes could enjoy premium discounts of up to 56 percent depending on their homes' locations and the standards used in their construction, according to Groves. Owners who improve their homes with stronger roofs and stormproof windows and doors could be eligible for discounts of up to 15 percent.

The sole task force recommendation that has yet to be addressed is whether the association can carry surpluses from one year to the next. Doing so, Groves said, could help pay claims following a major storm, reducing the assessments to participating companies.

The beach pool's board is scheduled to discuss the matter at its October meeting, he said.

ON THE NET

Alabama Insurance Underwriting Association: www.alabamabeachpool.org