Regulator Showcase: DISASTERS—Lessons Learned

Linda Gonzales (LA DOI), Angela Nelson (MO DOI) & Paula Pallozzi (RI DOI) share their experiences in dealing with disasters.
Linda Gonzales (LA DOI), Angela Nelson (MO DOI) & Paula Pallozzi (RI DOI) share their experiences in dealing with disasters.

Exchange participants were offered the unparalleled opportunity to interact with three regulators whose states have recently had significant disasters. Paula Pallozzi, Rhode Island Insurance Division; Angela Nelson, Missouri Department of Insurance; and Linda Gonzales, Louisiana Department of Insurance, shared their lessons learned from Superstorm Sandy, destruction of Joplin, and Katrina.

Tim Mullen, NAIC, served as moderator for this thought-provoking panel to help prepare professionals for the next disaster and started by asking…

How do regulators communicate with consumers when the unimaginable becomes reality?
Panelists were quick to discuss what how to handle communications when the infrastructure is gone:

  • Louisiana worked to create relationships so that all efforts could be leveraged.
  • Missouri had learned from Louisiana, so was better-positioned when the Joplin tornado struck. As a department, MDI employees also worked to be facilitative—not barriers to insurers seeking to get into the disaster zone.
  • Rhode Island, small in size, noted that resources are limited. Therefore, on-site assistance is less of a possibility. Pallozzi noted this department works on proactive communication as its best bet…prepare, prepare, prepare. She noted that cell phone and twitter did work effectively to get messages out before storms.

Gonzales (LA DOI) provides lessons learned following Hurricane Katrina.
Gonzales (LA DOI) provides lessons learned following Hurricane Katrina.

How DOIs handle uptick of complaints
Interestingly, all noted a lag in uptick of complaints because interaction with the company has to be unsatisfactory—and that takes a little time. However, all DOIs worked with companies to offer innovative, proactive interaction to mitigate the number of complaints and to provide outstanding consumer services. Specifically, DOIs:

  • Expanded hotline hours,
  • Provided an expedited complaint-handling option for companies to provide resolution within 48 hours; if they did, comments were classified as inquiry NOT complaint,
  • Field staff and phone banks set up with other states pitching in to help,
  • Creating villages—with disaster staff, social services, labor, FEMA, workers comp, banks, on site,
  • Collaborative expedited debris removal—clean sweeps of public and private property,
  • Expedited title process—work with DMVs to accelerate consumers’ claims, and
  • Pre-authorization of companies and adjusters to get to disaster sites.

Fraud issues

Angela Nelson (MO DOI) expresses how they handled the devastation following the Joplin tornado.
Angela Nelson (MO DOI) expresses how they handled the devastation following the Joplin tornado.

Any disaster creates opportunity for fraud in terms of contractor fraud, adjuster fraud, storm chasers, and price spikes. In addition to working with attorney generals’ offices to prosecute fraud activities, all also cautioned that consumers need to protect themselves and be alert. If something seems too good to be true, it probably IS too good to be true. Consumers must be educated and take the time to verify credentials of adjusters or contractors.

If only I knew…
Each disaster brings new lessons learned. Mullen asked panelists to articulate what was the one key piece each wished to share with the group. The answers were:

  • Strong relationships with industry representatives are critical. DOIs need to work with industry on lessons learned immediately after the disaster to anticipate the next one.
  • Create a toolbox so that everything is in one place for any disaster—no one knows what tool will be needed so make sure it’s comprehensive.
  • Build a database for outreach to industry, media, consumers, adjusters.
  • Get consumers to think about what to do if no home was available.

Paula Pallozzi (RI DOI) discusses dealing with insurers and consumers in the aftermath of Superstorm Sandy.
Paula Pallozzi (RI DOI) discusses dealing with insurers and consumers in the aftermath of Superstorm Sandy.

All panelists encouraged collaboration, anticipation and communication to get the word out, share best practices and ideas, and share data. Because consumers quickly forget, all present were encouraged to use every resource necessary to remind all to be prepared.

Panelists agreed that ultimately, DOIs want to help insurance companies do what they do best—help consumers.

CONTACT INFO
Linda Gonzales
Assistant Director, Rating
Louisiana Department of Insurance
PO Box 942124
Baton Rouge, LA  70804-9214
225.342.9055
ltgonzales@ldi.la.gov
www.ldi.la.gov

Tim Mullen
Director, Market Regulation
NAIC
1100 Walnut, Suite 1500
Kansas City, MO  64106
816.783.8260
tmullen@naic.org
www.naic.org

Angela Nelson
Director, Division of Market Regulation
Missouri Department of Insurance
P.O. Box 690
Jefferson City, MO   65102
573.522.9869
angela.nelson@insurance.mo.gov
www.insurance.mo.gov

Paula Pallozzi
Chief Property & Casualty Analyst
Rhode Island Insurance Division
1511 Pontiac Ave., Bldg. 69-2
Cranston, RI  02920
401.462.9616
Paula.pallozzi@dbr.ri.gov
www.dbr.ri.gov

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