Besieged Agents In Gulf Need A Helping Hand

Jodi Boudreau, executive vice president of the Professional Insurance Agents of Louisiana, said that although no agents lost their lives in the flood, some of their family members were not as fortunate.

She cited the case of one agent desperate in the aftermath of Hurricane Katrina who entered the office of her state association headquarters in Baton Rouge, La., and said, "I don't know what to do." The storm had destroyed his office, displaced his family, and taken his father–one of the elderly residents who died when flood waters swamped a nursing home in New Orleans.

"He had nothing," she said. "We tried to hook him up with other members and help him set up the process of what to do."

A number of agents have to start over from scratch, she said.

While New Orleans and the surrounding area have suffered from flooding, in the worst-hit areas of Mississippi–Bay St. Louis and Waveland–buildings and businesses have been totally destroyed, said Richard Davis, president of the Independent Insurance Agents of Mississippi and owner of Terral Insurance Agency in Quitman, Miss. He said 95 percent of the buildings in those towns were destroyed.

Ann Sturdivant, executive director of Professional Insurance Agents of Mississippi in Jackson, Miss., said since the hurricane, agents and staff have worked continuously to take care of customers. In some cases, she said, agents have nailed up boards with the name of the agency where the office once stood and are taking claims information from customers.

"They are back to work," she said. "They have an amazing attitude."

Mr. Davis said he knows of nine agencies that were totally destroyed. He explained that while most of the larger and some midsized agencies have offices outside of the affected areas to fall back on, others do not.

One agency, the Treutel Insurance Agency in Bay St. Louis, has set up a tent for customers. At the end of each day, the owners trek 110 miles to their family, which evacuated to Mobile, Ala. From there they communicate the day's claims data to their carriers before returning the next day.

"They are struggling just to hang on," Mr. Davis said. Some agencies, he related, are losing staff from the strain of the work. The conditions there, he explained, are "just like a third-world country. It's pretty bad."

Some areas have power but nothing else. Everything, down to paper clips, is gone, and the office supply stores are gone as well, he said.

Ms. Sturdivant took two pick-up trucks with office supplies and equipment to the Mississippi coast to distribute to agents in need.

Communication in Mississippi remains a major obstacle, agent groups said. The only way to make telephone calls in the region is with a satellite phone. Agents with generators can power-up a laptop and communicate by e-mail with the phone, but outside of that, there is no communication.

Louisiana is equally challenged, though slowly getting better.

"We are taking one step forward and two steps back, and hope by the end of the day we have moved an inch," said Robert Page, president of Charles A. Page and Sons Insurance Agency Inc. in Houma, La., describing the situation.

Communication is an issue, explained Jeff Albright, chief executive officer of the Independent Insurance Agents & Brokers of Louisiana in Baton Rouge, La. A major telephone switching station in New Orleans was destroyed. No calls are getting through, except for 800 numbers, he said. This makes it difficult to impossible to get through to carriers.

Mr. Page, who is secretary/treasurer of PIA National, said PIA has asked carriers to set up alternative numbers for agents to call. The carriers, however, have been reluctant because they are getting claims calls on the existing 800-numbers. But the reason those calls get through, he said, is because they come from out-of-state customers.

To help agents, Ms. Boudreau said the association has set up chat forums and an information page on its Web site, to help track them down.

Another issue is how agents will get paid. Officials said carriers are working with agents, in some cases helping them with a plan to pay a percentage on business they would normally receive, so agents have some income.

But Clinton Graham, executive vice president of the Independent Insurance Agents of Mississippi, noted that where a client has lost everything, some renewal premiums will be returned, cutting commissions. There are also lost clients because the business is gone.

"There is a lot of financial burden on these agents, besides the physical part," he said.

Finding office space is another challenge, as all available office and housing space has been taken, leaving some agents without a roof over their heads.

There is also spotty mail service.

Relief Efforts Continue

The Independent Insurance Agents & Brokers of America has increased its contribution to its Katrina Relief fund to $100,000 and is receiving substantial contributions from others to help agents get back on their feet.

The Alexandria, Va.-based association's chief executive officer said IIABA's National Board voted to increase the donation to the Big "I" Katrina Relief Fund from its initial $10,000 when it announced the establishment of the fund on Sept. 2.

"There is no more important cause for our national and state associations than helping out our fellow agents, brokers, and their employees, and their families in this time of great need," Mr. Rusbuldt said in a statement.

The association said it has sent hundreds of catastrophe packs with essential equipment for agents in the field to Louisiana, Alabama and Mississippi state associations.

Carrier Aid Summoned

Last week, the IIABA also sent out a letter to independent agency insurance carriers, asking them for "innovative, creative and flexible responses" in the wake of Katrina.

The letter signed by Mr. Rusbuldt, Mr. Albright and Mr. Graham pointed out that "very few independent agents have business interruption insurance coverage for floods."

Adding that widespread evacuation in some areas will mean that the payment of policy renewals will be somewhat chaotic for months, the letter urged insurers "to provide agents with flexibility in agency bill account current renewal payments, so that agents do not get caught in an untenable position between devastated insureds and companies."

The letter also asked insurers to consider:

o Creative ways to offer qualified agencies low-interest financing, since some agencies will have to rebuild.

o Donating unused office furniture, or offering agents the opportunity to buy furniture and equipment at reduced cost through volume discount arrangements they may have with providers.

o Establishing expedited claims appeals procedures, since coverage issues are expected.

Flag: Help Available

Additional information is available for agents:

o In Louisiana, at www.piaoflouisiana.com and www.iiabl.com (look for the Agency Assistance Resource to volunteer).

o In Mississippi at www.msagent.org (IIA of Mississippi site) and call PIA of Mississippi at 800-898-0136 or 601-936-6474.

o The Independent Insurance Agents & Brokers of America said it is also providing free Hurricane Katrina resource information through its Virtual University at www.independentagent.com/VU/NonMember/DisasterResources.htm.

o InsurBanc, of which IIABA is a partial owner, is offering a special loan program to qualifying agents. Information is available by contacting InsurBanc at 866-467-2622 or lending@insurbanc.com.

o Agents can also obtain information on flood programs through the Big "I" Flood Program at flood@iiaba.net.

Flag: Katrina Relief

Checks can be made out to the Big "I" Katrina Relief Fund and mailed to:

Big "I" Katrina Relief Fund

c/o InsurBanc

10 Executive Drive

Farmington, CT 06032

Credit card contributions can be made by going to www.insurbanc.com.

For insurance agents in Louisiana and Mississippi, the challenge is more than just serving clients. The hurricane has destroyed their offices, files and homes, and in some cases, killed loved ones.