Wondering if the destruction from Hurricane Harvey and Hurricane Irma will affect your insurance rates in Kansas?
The short answer is no, industry representatives say.
“Insurance rates are based on each state’s claims experience,” said Jim Camoriano, a State Farm spokesman for Kansas, Missouri, Oklahoma and west Texas. “This means premium dollars stay within the state and do not compensate for losses in other states.”
That’s because insurance is regulated at the state level, said Michael Barry, a spokesman for the Insurance Information Institute, an industry-funded consumer education organization.
“An insurer who operates in both Florida and Kansas cannot take money from Kansas and send it down to Florida,” Barry said. “Each insurance line must stand on its own financially in each state.”
“The cost of insurance in Kansas is going to be based on the actual and anticipated losses of insurers who operate in Kansas,” he added.
For example, wildfires in southwestern Kansas earlier this year are more likely to affect Kansans’ rates than the hurricanes in Texas, Louisiana and Florida.
“I’m not saying that automatically anybody is going to see rate increases in insurance because of that,” he said. “But that’s the type of event that generated insured losses that will be reflected in insurer rate filings over the next year or so.”
An insurer who operates in both Florida and Kansas cannot take money from Kansas and send it down to Florida.
Michael Barry, Insurance Information Institute spokesman
Natural disasters in Kansas, such as tornadoes, do not affect as many people as hurricanes do, Barry said.
“Hurricanes are covering a much larger amount of territory,” Barry said. “Rarely do tornadoes generate the types of insured losses that hurricanes do.”
He said there were exceptions like the tornadoes in Moore, Okla., and Joplin, Mo.