Gulf Coast presses for action on flood insurance, making political allies at the Jersey Shore [Asbury Park Press, N.J.]

June 10--During its years in Baldwin County, Ala., the community ministry All Churches Together accomplished a lot: getting dirt roads paved in poor neighborhoods, providing clean water and cleaning up drug hot spots.

After Hurricane Ivan blew through Baldwin County in 2004, church leaders began hearing a new worry.

"Over and over, homeowners insurance came up," said Michelle Kurtz, who works on the Homeowners' Hurricane Insurance Initiative, started by church leaders to deal with what they saw as unjustly mounting insurance costs for people living miles inland from the coast and Mobile Bay.

"Why in the world would this area's (insurance premiums) change 300 percent to 600 percent more than the rest of the state?" Kurtz said.

Over years of seeking answers, pushing for more transparency in Alabama's insurance market and connecting to homeowner groups in other Gulf of Mexico states, "we began to see that no state can handle its own risk," she said.

Now, with New Jersey homeowners facing escalating flood insurance costs, those Gulf coast advocates are making political allies at the Shore. At its May 28 meeting the Toms River Township Council voted for a resolution supporting Sen. Mary Landrieu, D-La., in her effort to amend 2012 reforms of the National Flood Insurance Program.

"All of my district is near the water," said council Vice President Maria Maruca, whose neighborhoods of Ortley Beach and the western Barnegat Bay shore lagoon streets were hit hard by Sandy's storm surge.

She said Toms River officials in particular want to see a restoration of flood insurance "grandfathering" -- allowing present owners of houses built to previous elevation standards to keep flood coverage at present rates.

The resolution was based on one from St. Charles Parish, La., where this spring homeowners learned they must elevate their homes or face unaffordable flood insurance increases. Maruca said it was brought to the council by Stop FEMA now, a homeowners group that started in Toms River and is in close contact with the Gulf Coast groups.

"We're trying to link up the East Coast with the Gulf Coast," said Kurtz, whose group recently added people in New Jersey to its network of 15 groups in eight states.

Activists in Louisiana, Alabama and other states hope the erupting flood insurance crisis could finally focus national attention on broader coastal insurance problems that have plagued the Gulf Coast for years.

The group's proposed solution: an inter-state "coastal reinsurance entity" that would pool financial risk for a "coastal band" from Texas to New England.

Even if it charged half the premiums common now, such a fund could still take in $10 billion a year and pay out for several hurricane hits annually, the HHII group contends. In today's market, a big percentage of premiums paid for wind coverage "go flying overseas to reinsurance," the primarily European financial companies that back up American insurance underwriters, Kurtz said.

"Reinsurers have just been pushing and pushing," said Tonia Pence, a New Orleans-based activist who works with homeowner groups. "It's a social justice issue. Why shouldn't insurance be a utility? It's the only unregulated industry that affects homeowners so much."

The emerging crisis in flood insurance costs should be another driver for reform, said Dan Hanson of HHII: "Let's link wind and flood and get rid of this problem."

Ivan's 14-foot storm surge destroyed beachfront condominiums at Orange Beach, Ala., and 90 mph wind gusts reached far inland. Today Orange Beach is restored; a $1.2 million beach replenishment last year was the finishing touch. Inland, across a landscape of modest houses, farms and pine woods, homeowners are still paying the price for Ivan.

Homeowners report annual insurance premiums of $3,000 to $5,000, with high deductibles for wind loss. It's a pattern that has emerged from heavy losses to Gulf hurricanes in the past decade, with underwriters saying they are charging for higher risk.

Eddie Derouen, an oil field worker in Plaquemines Parish, La., said he is paying a $5,500 year premium with $10,000 deductible for wind damage.

"We're getting ripped, because we're the highest-premium parish in the state," he said.

Kirk Moore: [email protected]

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