- The Washington Times - Wednesday, May 1, 2002

The tornado that ripped through Southern Maryland last weekend won't immediately raise insurance rates in Washington, but it will probably push premiums higher over time, industry representatives said yesterday.
The total number of tornado-related claims filed was not available, but one major insurer, State Farm Insurance Cos., said it has received about 1,100 claims for an estimated $6 million in damages from Maryland homeowners.
State Farm also received about 3,000 storm-related claims from automobile owners in the Mid-Atlantic states. A company spokeswoman could not estimate the value of the automobile claims.
"Rates generally do not rise because of one incident. They usually rise because of trends," said Jeanne Salvatore, vice president of consumer affairs for the Insurance Information Institute, an industry-funded research group.
The institute estimates the storms caused between $100 million and $200 million in property damages in 13 states from Missouri to Maryland. Final figures will not be available until late this week at the earliest, Ms. Salvatore said.
Premiums for homeowners, automobile and business insurance are rising between 6 percent and 10 percent nationally, she said.
"It is likely people will see an increase after the tornado, but there are several factors at play," Ms. Salvatore said.
The average homeowners' premium in Maryland was $372 in 1999, the 42nd highest in the nation, according to the most recent figures from the Insurance Information Institute. The average premium for renters' insurance was $133, the nation's 41st highest, the institute said.
Nationally, the average homeowners' premium was $487 and the average renters' premium was $171 in 1999, the institute said.
The tornado cleared a 24-mile path of destruction through Southern Maryland, devastating downtown La Plata, the Charles County seat.
At least 70 La Plata businesses or roughly 60 percent to 70 percent of the town's shops and offices were damaged or destroyed by the twister.
Duncan Creelman, a Waldorf insurance agent, said he has received between 80 and 100 claims for tornado-related property damage since Monday. One severe case is a business owner whose property suffered roughly $500,000 in damage, Mr. Creelman said.
He expects more claims to be filed this week, and predicted there are "probably hundreds" of customers whose automobiles may have suffered minor hail damage. "Many people who don't have serious damage won't call us for days," he said.
County officials say they will ask Gov. Parris N. Glendening, a Democrat, to apply for assistance from the Federal Emergency Management Agency and the U.S. Small Business Administration.
Any assistance would come in the form of 30-year loans of up to $1.5 million with a 4 percent interest rate, said David Iannucci, secretary of the Maryland Department of Business and Economic Development.
Mr. Iannucci told the Associated Press most business owners are expected to rely on private insurance, which he called "the cheapest money," because it doesn't require taking out a loan.
Charles County officials said yesterday they will set up a "People's Place," where residents can get help filing insurance claims.

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