BALDWIN COUNTY, Ala. — This is the second of two stories on a local grassroots effort to address the mounting insurance crisis in Baldwin and Mobile counties that has arisen since Hurricane Ivan in 2004.

Mark Twain typically gets credit for noting that everybody talks about the weather but nobody does anything about it.

Members of the Homeowners’ Hurricane Insurance Initiative (HHII) are attempting to do something about the weather; more accurately, they are out to change the perception of weather in the State of Alabama as regards insuring property.

The existing perception seems to be that Baldwin and Mobile counties are essentially “weather-beaten” by virtue of the annual threat of hurricanes along the coast, a threat that northern parts of the state don’t have to live with. Thus, insuring homes and property in the two coastal counties are expensive for homeowners and risky for insurance providers.

HHII is the organization that has been addressing insurance rate hikes and thousands of homeowner policy cancellations along the coast for the past several years. (HHII is sponsored by Coastal Baldwin Churches Community Organization, both of which are under the auspices of ACT-II, a faith-based organization that addresses social problems in Baldwin County.)

Where the current weather perception is concerned, HHII members say if it’s true, why does one insurance industry source say that 65 percent of the insurance claims that resulted from Hurricane Ivan were made inland? And why were repairs to the historic 19th century Jemison-Van de Graaff mansion in Tuscaloosa made with Hurricane Katrina relief money?

Citing a National Oceanic and Atmospheric Administration’s hurricane history chart, HHII says Alabama took a direct hit from a hurricane once every 11 years. Yet, the state is hit by 20 tornadoes on average annually. That works out to 220 tornadoes in Alabama for every direct hit by a hurricane.

“In the middle of the 20th century, 45 years went by without a single direct hit from a hurricane,” said Dan Hanson, who is on staff with HHII.

“During that time, there would have been more than 1,000 tornadoes around the state.”

For Hanson the historical data means the cost of making storm damage repairs in Baldwin and Mobile counties should be no more costly than it is in the rest of the state. The last reported state average for homeowners’ insurance was $954 a year, Hanson said.

A “Transparency” bill introduced in both houses of the Alabama Legislature last month would have required the State Department of Insurance to collect data that would prove that, historically, the south end of the state is either more expensive, less expensive, or the same to insure as the “north” end.

HHII would like to see total dollar amount of claims, county by county, collected over a period of time; the total homeowners’ premiums paid county by county; and the total number of policies county by county. Then, HHII says, everyone can simply do the math and determine if, indeed, it is more expensive to insure property in the two counties as opposed to the other 65. But Alabama’s DOI does not have this kind of data, HHII says.

“It stuns me that (DOI) approves insurance cosmos pricings that force widows and Habitat for Humanity homeowners 400 percent more than some parts of the state, and yet does not have the county by county data that proves these huge differentials are justified,” Hanson said.

According to HHII, the “Transparency” bill would “fix” that, but the bill failed to get out of a Senate committee late last month.

Without the insurance rates being addressed in the future, HHII and Hanson paint a worst case scenario.

GHOST TOWN SCENARIO

With over 50,000 wind and hail policies cancelled in Baldwin and Mobile counties over the past few years, Hanson said the insurance companies might be fearing that a period of greater hurricane frequency and intensity is upon us. If that alleged perception by insurance companies proves true - if another Ivan is on the horizon this hurricane season or next - HHII says all insurance companies could pull out of the two coastal counties. Thus, a progression could follow:

The so-called “beach pool” (Alabama Insurance Underwriting Association) is broke; nobody sells insurance in the two counties; mortgage companies deal with uninsurable properties; construction halts; banks demand a federal solution; wrangling and posturing by politicians ensues; those insured at the time repair damages, but are immediately uninsured; another storm hits; hundreds of thousands of structures are uninsured.

Asked about this “Ghost Town Scenario,” Ragan Ingram, media relations manager with Alabama DOI, said the beach pool is essentially the insurance companies themselves; that to have a certificate of authority in the State of Alabama an insurance company that sells property and casualty has to participate in the pool. Thus, even if companies pulled out of Baldwin and Mobile counties, those companies would still be addressing claims through AIUA for those local homeowners covered under the pool, which Ingram doesn’t foresee going broke.

Ingram said DOI talked with proponents of the “Transparency” bill two or three weeks prior to the bill’s introduction.

“There’s some problems with it,” he said, “one being the notion of going back and asking (insurance companies) for information 10 years back.” That’s something companies are not required to do, he said.

Also, Ingram said DOI does not have an actuarial model but operates on a “lock and key statute.”

“There are things in the (insurance) filings that are trade secrets and other competitors don’t need to see them,” Ingram said.

He did say DOI might support aggregate claims being released on a Zip code basis.

Contacted by telephone this week, Travis Ford, media contact for the Missouri Department of Insurance, Financial Institutions & Professional Registration, said of DIFP, “We collect a ton of statistics.”

DIFP’s Web site notes that Missouri Zip code insurance data for homeowners is available; that Missouri law requires companies writing personal lines insurance to “file data by ZIP code, including exposures written, premium written, loss paid count and losses paid,” all on an annual basis.

Ingram was asked what it would take for Alabama DOI to get something in place like Missouri DIFP has.

“The question is, can it be done by the (Insurance) Commissioner. We’re not sure,” he said, noting the Alabama Legislature can put such in place.

Of the “Transparency” legislation, Ingram said, “This bill had problems.”

FAITH AND PRACTICALITY

The Rev. Craig Bowyer of Foley, one of the organizers of the first multi-state hurricane insurance crisis organizational meeting of non-profits — a meeting held Wednesday in Biloxi — said that when people are treated unfairly, it is a faith issue.

“People who have paid premiums for decades with no claims are being dropped. Habitat potential owners have to have much more income now that insurance premiums are so high,” Bowyer said this week. Insurance premiums are sometimes more than the mortgage, he added.

For Bowyer one conclusion could be that insurance companies “don’t have a clue how to run their companies if they can’t do a better job of knowing their customers and where they live.

“Then when we consider how much they lost in the market downturn, and in shaky high yield investments like derivatives, we know why they are sending premiums through the roof.”

William Malone, 78, of Seminole has a maxim: “You live on the water, you should have to pay more (for insurance) than I do if I live on the hill.”

According to Malone, an insurance company should have the right not to insure people. For him a case in point is in Seminole, where he has lived his entire life. Some people live on the water in Seminole, he points out. So why should an insurance company insure a house on a lowland section along the river if they know it’s going to flood once every 20 years or so?

Yet, Malone has another viewpoint as well. He has a son who is a career Army man who is going back to Afghanistan.

“If the U.S. government can give money in Afghanistan to people to quit growing poppies, they can afford to help some people with their insurance,” Malone said.

“Who authorized my tax dollars to pay a guy not to grow a poppy crop?”

Thus, Malone feels like the insurance crisis in Mobile and Baldwin counties and elsewhere should be directed to higher ups - “the Senate and Congress, not local dudes.”

Malone’s viewpoint not withstanding, HHII has moved its argument for fair insurance rates to street corners and educating people in the coastal counties about what they perceive as the dramatic injustice and dangers associated with the insurance crisis.

Indeed, they want to take their argument elsewhere, namely, to what they call “peer-educating the rest of the state.”