Insurance Companies Profited on Hurricane Katrina

Linda Snyder

Contributor

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The American Association for Justice recently released a report on insurance companies and the analysis of how they handled Hurricane Katrina.

It's been over two years since the catastrophic Hurricane Katrina hit the Gulf Coast. Hurricane Katrina caused more than $135 billion in damages and left many people homeless and unemployed while insurance companies collected more than $40 billion the same year.

Many insurance companies spun the reasons of damage solely on flooding rather then wind, calling it "The Great New Orleans Flood." The insurance companies focused on "flooding" as the main reason because flooding isn't covered under homeowners' policies, while wind damage is.

As a result, numerous claims were denied, leaving many people without any help in rebuilding their lives. Other insurance companies went as far as to complete total fraud by altering reports on claims the companies did not agree with.

According to the Insurance Information Institute insurers have made over $100 billion in profit since Hurricane Katrina.

"Dr. Robert Hartwig, an industry mouthpiece, recently boasted that in Mississippi, more than 350,000 homeowner claims have been "settled" to the tune of $5.4 billion - yet this works out to a meager sum of only $15 thousand per settlement."

For more information on this subject, please refer to the section on Hurricane Damage and Denial of Coverage.