John Cerini, president of the Throggs Neck Merchants Association, and proprietor of Capital Shield Agency located at 3707 E. Tremont Avenue is happy to help those who had their homeowner policies canceled because of fear of a catastrophic storm hitting the New York City area.
“Allstate and other carriers are not renewing or accepting new customers,” Cerini said. “Originally, if you were buying both home and auto insurance, they likely would not drop you. But insurance companies in New York State can cancel four percent of their policies every year, regardless of whether you buy more than one type of insurance.”
The problem, which began in communities close to the water, took root a few years ago when Allstate decided not to renew many homeowners’ policies. Other carriers followed Allstate’s lead.
In the spring of 2006, residents in Edgewater Park, Locust Point, and City Island – and, later, non-coastal areas like Morris Park – were seeing their homeowner’s insurance discontinued even though they had not filed any claim.
Senator Jeff Klein proposed legislation that would reduce the amount of cancellations carriers can make in a given geographical area, lowering the present cap of 4% to 2%.
Allstate, by far the largest carrier in the eight counties of downstate New York with almost a quarter of the marker share, stated that the company is taking too large of a risk if a catastrophic storm hits.
“In order to preserve the promise we have made to the vast majority of our customers,” an Allstate statement reads, “we must continue to manage exposure in this catastrophe prone area.”
Many area homeowners did not understand, and were wondering if they really were in good hands.
“After Hurricane Katrina hit, there was a lot of concern on the part of insurance companies about a big storm in New York,” Cerini explained. “We should have been hit in 2006, with a 100-year storm, according to their predictions.”
Cerini said that it is especially important for all homeowners who have mortgages to have insurance, since your lender will put a “force place,” in effect, compelling the borrower to buy insurance, which always costs more than purchasing it willingly.
©2008 Community News Group