Former Mississippi Insurance Commissioner George Dale was one of the state’s most popular politicians, easily winning re-election again and again until earning the distinction of being the nation’s longest-serving insurance commissioner.
Then, Hurricane Katrina arrived. Tens of thousands of Gulf Coast residents were displaced by an unprecedented storm surge that rolled over large swaths of land that had never flooded before. Many homeowners didn’t have flood insurance, and even when left with only a slab found that their insurance companies refused to pay any claims—attributing all of the damage to flooding that the companies didn’t cover instead of wind, which they did cover.
With so many people homeless and yet still owning a big mortgage on a slab, there was a huge amount of pent up anger. When Dale ran for re-election to what would have been his ninth term, he was defeated in the primary election.
“I was the person they blamed after the storm,” Dale said. “I could have taken the easy road out and said what people wanted to hear, as other politicians did. But at the end of the day, some of those politicians that said some very harsh things about insurance companies did not get a single claim paid and have not gotten a single new company into the state to write business.”
Dale has no regrets about the position he took to avoid demonizing the insurance companies, which could have meant there was not an insurance market on the Coast when it was all over. Second, he worked to get as many claims paid as he could.
“I didn’t think it served either one of those two assignments well to make a lot of inflammatory public statements, so I chose not to,” Dale said. “Some people thought since I didn’t make inflammatory statements, I wasn’t doing anything to help them.”
Dale set up arbitration between policy owners and insurance companies, and in many instances that resulted in claims being settled. He says within one year after Katrina, 97 percent of the claims were settled. Within two years, all the claims were settled except one percent.
“This was from the largest natural disaster to hit the U.S.,” Dale said. “But if you read some publications, you would think nobody’s claim was ever paid.”
Dale, who married a woman from the Coast, had two brothers-in-law whose homes were damaged in Katrina. One had only a slab left, and the other had eight feet of water. Neither was bitter against the insurance companies because they had flood insurance.
“A lot of people didn’t have flood insurance, and when insurance companies didn’t pay for wind, they were the ones who were hurt the most,” Dale said.
There were allegations made that insurance companies had a conflict of interest in the wind-versus-flood debate. While there were some eyewitness accounts of buildings being blown away before the flood surge, most insurance companies attributed damage from “slab” cases entirely to flood. Some homeowners prevailed in wind-versus-flood lawsuits against their insurance companies. Others lost.
Katrina made it obvious reform was needed, but in the intervening years, little progress has been made. Recently when Hurricane Ike devastated Galveston, Texas, it was the same old story. Insurance companies claim the damage was caused by flooding, while homeowners without flood insurance are claiming it was wind damage.
“There has been no progress on the wind-versus-flood debate simply because politicians have chosen not to work with insurance companies to seek a solution,” said Dale, who has been asked by the Texas insurance commissioner to serve on a Hurricane Ike task force. “It is more politically expedient for them to work against insurance. Therefore, nothing has happened. What makes this problem even worse is you’ve got media outlets like the Biloxi Sun Herald that refuse to be objective about what should be done to correct this problem. They are too busy bashing whoever is in the insurance department rather than trying to get out all of the facts.”
Dale said it hasn’t set well with insurance executives to pick up newspapers such as the Sun Herald and read the insurance executives should be treated as sexual perverts. Companies say, “Why should we want to do business in Mississippi?”
Dale said that makes current Insurance Commissioner Mike Chaney’s job to provide a stable insurance market on the Coast extremely difficult.
Dale, who took only nine days off after leaving office at the end of 2007 before starting a job as a senior governmental affairs advisor with the law firm Adams & Reese, believes the insurance market on the Coast will come back the farther we get from Katrina without another major storm.
“The free enterprise system will work if you give it time, and don’t obstruct free enterprise,” he said. “When insurance companies that are profit drive realize they can make a profit in the area, they will sell the product.”
After decades in public office, Dale knows many people in government and insurance circles around the country. His present job allows him to continue to have contact with political and business leaders on the state and national level.
“Nobody enjoyed public service more than I did,” Dale said. “I can’t get it completely out of my blood. People have asked me if I would consider running for mayor of Clinton where I live. You couldn’t appoint me mayor of Clinton. If I ever did anything, it would be on a statewide basis. But if I did run again in a state race, I would lose my wife and all my children. I’m enjoying working with Adams & Reese. They are a good firm to work with. We do a lot of stuff on Capitol Hill that is very interesting.”
Contact MBJ contributing writer Becky Gillette at email@example.com.