NU Online News Service, Aug. 5, 3:56 p.m. EDT

Half of Consumer Reports' readers who filed insurance claims resulting from Hurricane Katrina in 2005 said they had problems with their insurer, the magazine reported.

In the September issue of the consumer watchdog's magazine, the organization says 26 percent of its readers also complained that they were paid too little for their claims.

"A disaster tests everyone, and in the eyes of our readers insures often failed that test," the magazine said.

The magazine's readers did have high praise for three insurers--Amica Mutual Group, USAA Group and the Chubb Group.

Readers said they were dissatisfied with the service of large insurers and delays in claims payments were a common complaint.

People with good credit scores and claims history received more favorable treatment from insurers than those with poor credit scores and claims history, the article said.

The vast majority of consumers, however, are content with their homeowners coverage, Consumer Reports found.

Responding to the article, Loretta L. Worters, spokeswoman for the Insurance Information Institute, said the report is typical of what the magazine writes, with an emphasis on the negative despite some positive news that they downplayed.

She called the survey narrow because it only reflects the opinions of Consumer Reports' readers.

"It is not a reflection of policyholders as a group," she said.

Ms. Worters praised a video that accompanied the online article advising consumers that they need to purchase flood insurance to protect their home and property. However, she said the organization should have mentioned that excess flood policies are available for consumers whose homes are worth more than the maximum the flood program covers.

The article and video are available at www.consumerreports.org and clicking on Consumer Reports Magazine.

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