Broker Says Firms Readier This Hurricane Season Than In '05

NU Online News Service, Aug. 19, 3:53 p.m. EDT

As Hurricane Bill, the season's first major hurricane, swirls through the Atlantic, an insurance broker says businesses are far readier for natural disasters than ever before.

The storm, now a Category 4 hurricane with sustained winds topping 135 mph, is "likely to veer away from the United States" and is unlikely to impact Bermuda, said Risk Management Solutions catastrophe modeling firm.

Arnold Mascali, managing director of Chicago-based insurance broker Aon's Rapid Response practice, said risk managers and Fortune 500 companies have made a lot of changes in how they plan for disasters and what their response will be since Hurricane Katrina in 2005.

There is more emphasis on disaster preparedness, he said, from everyone concerned--meaning insurers, brokers and policyholders. Many clients have spent a significant amount of time valuing their assets, both in terms of property value and business interruption losses, with one of the lessons learned that policyholders need to present accurate insurance values to insurers if a disaster strikes.

A major concern for clients is protecting the brand, to make sure the affected store or building is up and running again before their competition, he said.

"The single biggest difference is on that emphasis," he said. "There is only one way to do it and that is to be prepared."

Of course, preparation is more acute in areas that have disaster experience, such as Florida and the Gulf Coast, but those in the Northeast are not totally unprepared. Hurricane Bill has brought more phone calls into the office, he said, to make sure things are in order to begin the claims and cleanup process should a disaster strike. They may be calling a little later than they should, he noted, but it is not too late.

"The one thing you don't want is to have the phone call after the event," he said.