Insurance firms prepare for worst

Friday, July 9, 1999 | 11:11 a.m.

Major insurance companies are poised to send teams of adjusters to Las Vegas in anticipation of a deluge of claims in the wake of the worst flooding locally in 15 years -- a disaster that is not covered by most homeowners insurance policies.

Farmers Insurance Group quickly declared the flooding a catastrophe and has begun bringing in additional claims adjusters from out of state to help local adjusters, according to spokesman Jeff Reing.

Reing said Farmers Insurance declares a catastrophe if it expects more than 1,000 claims to be filed on more than $1 million in damages.

Those figures should easily be surpassed.

But some local insurance agents reported only a trickle of claims this morning.

"I'm surprised we've not had more calls," said Nina Warren of American National Insurance, 3841 W. Charleston Blvd. "During the storm we got four or five calls. One of the agents called me and said his client had just purchased a brand-new house in the eastern part of town and didn't yet have any mortgage insurance. He wanted to know what to do."

Richard Berstein, general counsel for Metlife Auto & Home in Rhode Island, said Metlife also has a catastrophe team that will be available if the claims begin arriving in numbers too great for local adjusters to handle.

Jeff Hoffman, with Allstate Insurance regional headquarters in Phoenix, said its catastrophe team is on standby, waiting for more information.

He noted that many are in Oklahoma City, helping clients who suffered losses in a tornado earlier this year.

State Farm Insurance spokeswoman Christ Dunn said her company also is waiting for more information about the damage assessment before declaring a catastrophe.

One tragic aspect of the disaster is that most homeowners don't have flood insurance. Only about 12,300 homeowners have flood insurance in all of Nevada, according to Stephanie Saari, spokeswoman for Western Insurance Information Service, a nonprofit organization media relations organization.

Saari said flood insurance is offered only by the federal government, although private insurance companies help clients obtain it.

She said only about 960 flood claims have been paid in Nevada since the federal government took over the program in 1973.

The average premium for flood insurance is $411 a year, she said.

"Whether a client thinks they are covered or not, they need to let the insurance company know. They need to document the damage, with a photo or video," Saari said.

One hope that may be held out for homeowners is the declaration of the flooding as a natural disaster.

Mary Margaret Walker of the Federal Emergency Management Agency in San Francisco says she has not been contacted yet to do an assessment of the damage to begin the process of declaring a natural disaster.