Homeowner's Insurance, Insurance, Insurance Brokers

Insurers under Critical Observation in Puerto Rico

As if Hurricane Maria hasn’t already taken a toll on most Puerto Ricans. Insurance companies are under scrutiny in Puerto Rico with 13,600 Hurricane Maria claims still open. This has resulted in thousands of Puerto Ricans being forced to close their businesses, drain their savings, or accept the idea of living with structural damage as they fight insurance companies over millions of dollars’ worth of claims. Claims that have gone unanswered or unpaid more than a year after Hurricane Maria.

What the Experts Have to Say

According to experts the Category 4 storm caught insurance companies off-guard and left them reeling financially after they were hit with nearly 279,000 claims. Real Legacy, a major insurer has already folded, leaving more than 1,500 claims worth a total of $70 million up in the air. It’s not a surprise that many worry other companies may follow. Commissioner Javier Rivera believes that it’s too early to say what will happen with Real Legacy. He also believes that the other company that exceeded its reinsurance limits, Triple-S, has enough capital to avoid the similar outcome. Executive Director of Puerto Rico’s Association of Insurance Companies, Iraelia Pernas, said “the industry has never faced such an astronomical number of claims.” “No one was prepared for that, not the federal government, not the insurance companies, no one.”

Hurricane Maria Caught them Off-Guard

Fines have already been issued by the Office of the Insurance Commissioner of Puerto Rico totaling more than $2.4 million against at least seven companies for delays in resolution and payment of claims. Exceeding reinsurance limits is highly unusual and indicates that even in the companies’ worst case scenario, Hurricane Maria was difficult for them to envision. There are two insurance companies in Puerto Rico that are also under review with negative implications.

The Aftermath of Hurricane Maria

Not only was Hurricane Maria the strongest storm to hit Puerto Rico in nearly a century, but it caused more than $100 billion in estimated damage, destroying the power grid and forcing businesses to remain closed. Hurricane Maria has taken a toll on the insurance industry, with losses amounting to $32 billion. Insurance companies in Puerto Rico have paid a total of $4.4 billion in claims, but more than 13,600 claims have not been closed.

Taking a Closer Look into Insurance Companies

An audit was recently launched into all companies by the commissioner’s office, and according to Rivera he is looking at some more closely than others. His office has received about 1,600 complaints, which is triple the amount of reports received in a normal year. Pernas says that the pending claims from Maria are complicated and involve mostly businesses, municipalities, government agencies and condominiums – which have to be reviewed with great care because they’re big.

Business that have Disappeared

Many people were forced to close their businesses due to Hurricane Maria. Among those was a 48 year old man who owned a restaurant in the northern coastal town of Dorado that he opened four years ago. He reported damages exceeding half a million dollars, but has only received $93,000 from the insurance company. Due to these circumstances he has used up all his savings, sold his home and transferred his daughter to a more affordable school. By December he will make the decision between staying or leaving Puerto Rico and joining the estimated 155,000 who fled to the U.S. mainland after such a catastrophic hurricane.

No Responses from Insurance Companies

Gov. Ricardo Rosello has already sued various insurance companies after officials said they did not respond quickly enough to claims filed after Hurricane Maria. These lawsuits help because they aim to prevent companies from dropping claims that have allegedly expired. The lawsuits seek $2.6 billion in damages for those who have not been compensated. Attorney, Francisco Amundaray is representing several clients pursuing a response from insurance companies. Among those waiting for full payment is a woman, who owns a pharmacy in the southern coastal town of Salinas. She reported $50,000 in total losses after Maria. She has called the insurance company several times about her claim but has only been told that it’s being processed. This has resulted in her being forced to refinance her house, cancel her daughter’s university housing, cut her staff at the pharmacy by half and reduce operating hours.

Planning for the Future

By law, insurance companies in Puerto Rico have 90 days to resolve a claim. Companies are now making contingency plans and expect to fly in claims adjusters ahead of any major storms in the future.

Advertisements
Standard
Financial Advisor, Financial Services, Investing, Stock Market

How Does the Stock Market Work?

How Do Financial Advisors Make MoneyEveryone has questions about the stock market – how should they invest? How much money should they invest? How do they decide on which stocks to buy? All of these questions leave people wishing they had paid more attention in those economics classes in college! But while business courses prepare people for the theory behind investment strategies, they often do not touch on specific strategies at all. So, in order to make the most informed decision about where to invest those hard-earned savings, spend some time learning about how the stock market works so that money can work with the investor, not against them. For additional insight, consult with a financial advisor in New Jersey who can explain the ins and outs of investing for the novice investor. Continue reading

Standard
Financial Advisor, Financial Services, Investing, Retirement

What Millennials Should Know About Retirement

Insurance Broker QuestionsThough the millennial generation is just starting to enter the workforce, they are a forward-thinking bunch. And with anyone who is looking to get ahead in their future lives and careers, preparing for a comfortable retirement is always a good practice to cultivate. However, college courses and economics classes often do not prepare students, now employees, for maximizing their retirement savings. To cut down on the myths, here are a few tips that financial advisors in NJ often give to their millennial clients.
Continue reading

Standard
Financial Advisor, Financial Services, Personal Finance, Retirement

What Baby Boomers Should Know About Retirement

Financial AdvisorWhile baby boomers probably remember their first few days in the workforce, they are steadily working their way towards retirement. And it’s coming quickly! However, many baby boomers are a part of a smaller subset of their generation who do not really know how to prepare for retirement, or how to take advantage of that preparation. This article does not aim to be the definitive resource on retirement, but it does address several mistakes that baby boomers make that limit the amount of resources at their disposal when they enter retirement. So, here are a few tips and tricks according to a top top NJ financial advisor on how to avoid those missteps and better educate this generation on how to retire right.
Continue reading

Standard
Financial Advisor, Financial Services, Investing, Personal Finance, Retirement

8 Ways to Retire Before 65

InsuranceThough practically everyone views the number 65 as the magical age at which they will retire and start living the life they always wanted to, who says that 65 has to be the precise age to retire ? Why not 55 or even 45? While many people may feel that retiring early, even by just a few years, is an unrealistic expectation, this definitely does not have to be the case. Instead, consider making a few small lifestyle adjustments that will have significant, positive financial impacts later in life.  Prior to consulting with a financial advisor in NJ,

consider the following eight steps which will help to save the most money for an early retirement.
Continue reading

Standard
Financial Advisor, Financial Services

10 Financial Benefits of Homeownership

Homeowners InsuranceHomeownership is a major investment, and can be prohibitively costly for many individuals. However, younger buyers are often looking to make concrete financial investments that they can physically see, rather than playing the ephemeral stock market. For such investors, owning a home can be a great way to start accumulating assets, while also being a very practical place to live, for several reasons.  Here are a few of the top financial benefits according to a leading financial advisor in NJ:
Continue reading

Standard