Florida Farm Bureau Insurance Helping you is what we do best.

Strong Insurance Commitment to Consumers 

after Record 2017 Natural Disasters

Federal Advisory Committee on Insurance

December 6, 2017

Florida Farm Bureau Insurance Helping you is what we do best. 
Florida Farm Bureau Insurance Helping you is what we do best.

Florida Farm Bureau 

• Florida Domestic with State Office located in Gainesville, Florida.

• Approximately 425 employees and exclusive agents located around the State 

of Florida.

• Through our parent, Southern Farm Bureau Casualty Insurance Company 

we’ve been insuring Floridians since 1947.

• We were here before Hurricane Andrew and we’ve been here through 

Charley, Francis, Ivan, Jeanne, Dennis, Katrina, Rita, Wilma, Matthew and 

Irma.

• Rated “A” Excellent, with a size IX Financial rating by A.M. Best.

• Write approximately 1% of the Florida homeowners and auto market. 

“What we lack in size, we make up in service.”

2
Florida Farm Bureau Insurance Helping you is what we do best.

2017 Historic Storms & Wildfires

Impact on Consumers

• Over 27 million people live in disaster zones impacted by Harvey 

and Irma

• Over 8 million housing units are in declared disaster zones throughout 

Texas and Florida

• Nearly 300,000 licensed adjusters reside in Texas and Florida alone

• Insurers have already settled over 800,000 claims, paying over $36 

billion, to help homeowners across the nation get back on their feet 

3
Florida Farm Bureau Insurance Helping you is what we do best.

Florida Farm Bureau 

Irma Claims Statistics

Date

Reported 

Claims

Percent 

Closed

10/12/2017 8,620 87.0%

10/19/2017 8,787 91.7%

10/26/2017 8,926 94.1%

11/2/2017 9,000 95.2%

11/10/2017 9,085 95.4%

11/22/2017 9,170 96.1%

4
Florida Farm Bureau Insurance Helping you is what we do best.

Historical Ranking

5

$49.8 

$23.2 

$13.9 

$25.0 $24.5 $21.6 $19.9 $18.9 $14.0 $12.5 

$25.0

$25.0

$35.0 $35.0 $30.0

 $-

 $10.0

 $20.0

 $30.0

 $40.0

 $50.0

 $60.0

Katrina Harvey Irma Sept. 11

Attacks

Andrew Maria Sandy Northridge

EQ

Ike Wilma

Top 10 Costliest U.S. Catastrophes – Insured Losses 

PCS Estimate RMS Low Estimate RMS High Estimate
Florida Farm Bureau Insurance Helping you is what we do best.

Historical Ranking

(*2017 and 2005 Cat Seasons include hurricane damage only)

6

$59.1 $62.5 

$25.0 $24.5 $19.9 

$65.5

$100.5

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

2017 Cat Season 2005 Cat Season Sept. 11 Attacks

(2001)

Andrew (1992) Sandy (2012)

Costliest U.S. Disaster Years

($ Billions)

PCS Estimate RMS Low Estimate RMS High Estimate
Florida Farm Bureau Insurance Helping you is what we do best.

Insurance Market Impact

1 http://www.rms.com/newsroom/press-releases/press-detail/2017-09-09/rms-estimates-hurricane-harvey-insured-losses-from-wind-storm-surge-and-inland-flood-damage-will-be-between-usd25-and-35-billion; 25-35 billion less 7-10 billion in NFIP 2 http://www.businessinsurance.com/article/20170920/NEWS06/912315969/Insured-Irma-losses-could-reach-$55-billion-Risk-Management-Solutions 3 http://www.rms.com/newsroom/press-releases/press-detail/2017-09-28/rms-estimates-insured-losses-from-hurricane-maria-will-be-between-usd-15-and-30-billion; includes damage to other 

Caribbean nations not yet broken out

4 http://www.insuranceinsider.com/karen-clark-puts-nate-loss-at-500mn 7

Likely private insured losses from Harvey: 

$18 to $25 billion1

Likely private insured losses from Irma: 

$22.5 to $29.5 billion2

Likely private insured losses from Maria: 

$15 to $30 billion3

Likely private insured losses from Nate: 

$0.5 billion4

Likely private insured losses all storms: 

$56 to $85 billion
Florida Farm Bureau Insurance Helping you is what we do best.

Hurricanes Impact Across Lines of Business

PCS Initial Insured Losses 8

Commercial Flood

Commercial Property

ex. Flood

Auto Property

Residential Property

2%

34%

19% 13%

32%

Harvey

9%

24%

58%

4%

5%

Irma

NFIP (PCI Estimate)

87%

0% 11%

2%

0%

Maria

Commercial Flood & Property
Florida Farm Bureau Insurance Helping you is what we do best.

9

Hurricane Irma

Estimates as of Oct. 15, 2017

County

Housing Units 

2016

Population 

2016

Miami-Dade 1,021,527 2,712,945

Broward 822,931 1,909,632

Palm Beach 683,521 1,443,810

Hillsborough 568,839 1,376,238

Orange 525,243 1,314,367

Pinellas 507,425 960,730

Duval 402,313 926,255

Lee 385,070 722,336

Polk 286,515 666,149

ALL OTHER (39) 3,382,050 7,066,072

Total 8,585,434 19,098,534

Declared FL disaster zones:

Designated IAPA in FEMA map as of 9/13/2017

https://gis.fema.gov/maps/dec_4337.pdf

Building characteristics:

• 7,262,161 buildings in exposed regions 

of FL 1 with an estimated worth of $2.2 

trillion.

• Estimated 880,000 damaged/destroyed 

buildings.

• Only 22% of homes 2 in highest wind 

areas were built below 1995 building 

code revision (post-Andrew).

• 1 FEMA HAZUS Model 9/11/2017 

• 2 CoreLogic presentation: Hurricane Irma, the Story Unfolds 9/21/2017
Florida Farm Bureau Insurance Helping you is what we do best.

10

CAT Impact on Insurers’ Net Income

Sources: Net Income, S&P Global Market Intelligence; CAT losses, 2015-2016 PCS via III, and 2017 

PCI est. Harvey, Irma, Maria, CA fires using PCS
Florida Farm Bureau Insurance Helping you is what we do best.

11

CAT Impact on Insurers’ Net Income

Sources: S&P Global Market Intelligence (adjusted for inflation)

 $(5.0)

 $-

 $5.0

 $10.0

 $15.0

 $20.0

 $25.0

 $-

 $20.0

 $40.0

 $60.0

 $80.0

 $100.0

 $120.0

Net Income ex. Capital Gains

Net Incurred Losses
Florida Farm Bureau Insurance Helping you is what we do best.

Impact on Primary/Reins. Market

Harvey/Irma/Maria/Nate (HIMN)

$41.5

$723.0

$0

$100

$200

$300

$400

$500

$600

$700

$800

Insured Losses Surplus

Primary P&C ($ Billions)

12

Sources: RMS, Aon-Willis, I.I.I., PCI/Verisk Sources: RMS, S&P Global Intelligence

$41.5

$605.0

$0

$100

$200

$300

$400

$500

$600

$700

$800

Insured Losses Surplus

Reinsurance ($ Billions)
Florida Farm Bureau Insurance Helping you is what we do best.

13

Lessons Learned
Florida Farm Bureau Insurance Helping you is what we do best.

14

Lessons Learned From Previous Hurricanes

Communication with Policyholders:

• Pre-storm communications with our policyholders 

emphasized safety first, protection of property.

• Post-storm communications with our policyholders 

advised of early reporting of claims to our call center. 

• Utilized email and social media, as well as, traditional 

methods.
Florida Farm Bureau Insurance Helping you is what we do best.

15

Lessons Learned From Previous Hurricanes

Pre-storm operational preparations:

• Facilities – generators, communications, out-of-state call center

• Staffing – advance preparation for out of state Farm Bureau adjusters 

(including emergency licensing and housing needs), advance 

preparation (contracting) of independent adjusters.

• Systems – Anticipated FLOIR emergency order based on previous 

storms so, systems were pre-programmed to immediately implement 

suspended premium billings and cancellations/nonrenewal. Upgraded 

Claims system since 2005 storms.

• Communications with reinsurers to make sure funds readily available 

for paying claims.
Florida Farm Bureau Insurance Helping you is what we do best.

16

Lessons Learned From Previous Hurricanes

Post-Storm Operations –

• Contact with policyholders on a local level via local Farm Bureau 

agents and staff.

• Immediate conference call with Agency Managers to assess damage in 

each county. We knew early on that Polk County was the hardest hit.

• Geocoding for claims assignment efficiency.

• In addition to central out-of-state call center to handle initial claims, 

set up a second local call center to handle call backs and follow ups. 

• Adjusters – Logistics usually regional, this time Statewide. Advance 

contract with hotel chain for adjuster lodging.
Florida Farm Bureau Insurance Helping you is what we do best.

17

Lessons Learned From Previous Hurricanes

Post-Storm Operations (continued):

95 Adjusters within first 5 days after storm:

• 41 Farm Bureau staff adjusters

• 33 Farm Bureau adjusters from other states

• 21 Independent Adjusters
Florida Farm Bureau Insurance Helping you is what we do best.

Industry Lessons Learned

Need a Better Way to Protect Citizens –

Too Many Uninsured Consumers

18

32%

68%

RMS/Moody's Initial Maria Estimates

71%

29%

RMS Initial Irma Estimates

37%

63%

RMS Initial Harvey Estimates

Insured Economic Losses Uninsured Economic Losses
Florida Farm Bureau Insurance Helping you is what we do best.

Industry Lessons Learned

Too Many Uninsured/Underinsured

• Estimated that 80% of Harvey flood victims do not have flood insurance

• Take up rates for flood and earthquake insurance remain low 

• Across the nation only 12% of homeowners carry flood insurance, take up 

rates are slightly better in flood prone Texas and Florida at 17-20%

• Even in earthquake prone California, only 11% of homeowners purchase 

earthquake insurance

• Consumers should take a proactive role in protecting their property

https://www.washingtonpost.com/news/wonk/wp/2017/08/29/where-harvey-is-hitting-hardest-four-out-of-five-homeowners-lack-flood-insurance/?utm_term=.2cbe373edd63

19
Florida Farm Bureau Insurance Helping you is what we do best.

Industry Lessons Learned

Protect Your Vehicles 

Harvey and Irma = estimates

400K

346K

300K

258K

0

50

100

150

200

250

300

350

400

450

Harvey Katrina Irma Sandy

Thousands of Claims

20

Sources: I.I.I.–RMS-Cox Automotive Sources: Insurance 

Council of Texas, Fortune

$4.8 

$2.9 $2.7 

$2.2 

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

Harvey Irma Sandy Katrina

Losses in $ Billions
Florida Farm Bureau Insurance Helping you is what we do best.

Industry Lessons Learned

Protect Your Vehicles

Harvey and Irma = estimates

21

Sources: RMS, CoreLogic, 

Morgan Stanley, Fortune

15.0% 14.5%

9.0%

5.4%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

Harvey Sandy Irma Katrina

Percentage of Total Insured Losses

6.70%

5.60% 5.40%

1.80%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

Irma Harvey Sandy Katrina

Percentage of Total Economic 

Losses

Sources: RMS, CoreLogic, 

Morgan Stanley, Fortune
Florida Farm Bureau Insurance Helping you is what we do best.

Industry Lessons Learned

Private Flood Insurance Losses Greater Than NFIP Losses

Sources: RMS-FEMA 22

$8.5 

$4.0 

$14.0

$8.5

 $-

 $5.0

 $10.0

 $15.0

Harvey Irma

Estimated Flood Losses 

(in $ billions)

NFIP Estimate Private
Florida Farm Bureau Insurance Helping you is what we do best.

23

Long-Term Challenges
Florida Farm Bureau Insurance Helping you is what we do best.

Long-term Challenges 

Building Codes

• Insurance Institute for Business & Home Safety (IBHS) rates Florida as 

having one of the strongest building codes in the nation

• An IBHS study following Hurricane Charley in 2004 found that homes 

built to the most recent version of the building code showed a 40% 

reduction in frequency and 60% reduction in severity of property damage

• Multi-hazard Mitigation Council study found that every $1 spent on 

mitigation saves society $4

• http://disastersafety.org/wp-content/uploads/2015/07/rating-the-states-2015-public.pdf; https://disastersafety.org/ibhs-public-policy/building-codes/

• Natural Hazard Mitigation Saves: An Independent Study to Assess the Future Savings from Mitigation Activities, Multihazard Mitigation Council, 2005. 

24
Florida Farm Bureau Insurance Helping you is what we do best.

Long-term Challenges 

Assignment of Benefits (AOB)

• Issue involves policyholders who sign forms 

assigning the benefits under their policy to 

various third parties (e.g., contractors, public 

adjusters, attorneys, auto glass facilities)

• Certain third parties will then inflate those 

claims for their own financial benefit 

• Florida is ground zero for AOB abuse

• The Florida OIR, Citizens, and insurers have 

collaborated towards achieving meaningful 

reforms, including attorney fee reforms which 

will reduce incentives for AOB abuse

25
Florida Farm Bureau Insurance Helping you is what we do best.

Long-term Challenges

Other Issues

• Claims adjuster squeeze

– Shortage of qualified adjusters following Hurricanes Harvey and Irma

– Some adjusters quit contracts to migrate to better offers 

– Improved technology/drone use could help adjustments 

• Speeding salvage title/lienholder process

– Administrative procedures at lenders causing delays in claims 

settlement of flood damaged vehicles

– Need centralized contact points and streamlined lender approvals for 

consumers/adjusters to get liens quickly released on totaled vehicles

• Protecting consumers from “title washing” 

26
Florida Farm Bureau Insurance Helping you is what we do best.

Long-term Challenges

Other Issues

• Construction challenges

– Construction industry expects labor shortages to pose extra 

challenges and costs for rebuilding after catastrophe-laden year

• Land management issues – floods and wildfires

– Policymakers need to continue reexamining regulation of 

rebuilding in flood prone area as well as land use policies impacting 

wildfires to reduce societal exposure and losses

27
Florida Farm Bureau Insurance Helping you is what we do best.

Public Affairs Impact

28

Adjuster Ride Along | Florida Farm Bureau | Media Interviews