ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, October 10, 1996 TAG: 9610100101
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
In a sweeping effort to reduce its exposure to natural disasters, one of the nation's leading insurers plans to announce today that it will sharply curtail the sale of new homeowner policies in coastal areas along the hurricane-vulnerable Eastern Seaboard and Gulf of Mexico, from Maine to Texas.
The decision by Nationwide Insurance Co., the fifth-largest insurer of homes in the country, would be the latest and most extensive retrenchment by insurance companies reeling from recent losses caused by hurricanes, earthquakes and other huge disasters. It will virtually halt sales in Florida.
Until now, most insurance withdrawals have been relatively circumscribed. Allstate and State Farm, the country's two largest providers of homeowner insurance, have limited their sales in Florida and California as well as parts of North and South Carolina. The Farmer's Insurance Group, the third-largest home insurer, cut back sharply on sales in California after the 1993 earthquake in the Los Angeles area. But none has taken action affecting as much territory as Nationwide.
Richard D. Crabtree, president and chief operating officer of Nationwide, said the curtailment was crucial to protect the financial security of the company.
For coastal dwellers in the East, reductions in the availability of insurance are leading to higher costs and, in many cases, sharply limited coverage. The effect on homeowners outside the most vulnerable coastal areas varies from state to state, depending on different regulations and calculations of risk.
- The New York Times
LENGTH: Short : 39 linesby CNB