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Schools hit by spiraling insurance premiums, lack of providers

HATTIESBURG — Property insurance premiums have skyrocketed for Pine Belt school districts. Some have had problems just finding a company to insure them.

Lamar County School District Superintendent Ben Burnett told the Hattiesburg American that his district’s premium was about $176,000 last year but just increased by $500,000.

“I was shocked,” he said. “We always budget for a percentage increase, and we had heard that our property insurance carrier from last year had dropped all K-12 schools because of weather-related claims, but never in my wildest imagination would I have anticipated a half-a-million increase.”

It’s not just the Pine Belt, said John Wells, with the state Commissioner of Insurance’s office.

“This was a tough year, with schools calling in here,” he told the Hattiesburg American. “It’s tough all over the state.”

Catastrophic losses caused by fire, tornadoes and hail have hit the school insurance business hard, state Commissioner of Insurance Mike Chaney said in an email. One carrier, he said, collected $16.6 million in premiums from school districts between 2009 and 2013 and paid out $55 million in claims.

Johnny Downs, who takes care of the Lamar County district’s insurance, said it had $4 million in claims from Hurricane Katrina in 2005 and $7 million in claims from the Feb. 10 tornado. In addition, he said, insurance companies are now rating areas according to the amount of wind damage that could be sustained in a storm.

The Hattiesburg Public School District’s property insurance cost rose $340,000, to $519,000 this year.

“We had a 130 percent increase,” Superintendent James Bacchus said. “We had anticipated about an 80 percent increase.”

That extra expense kept the district from hiring more reading coaches, he said.

Forrest County School District’s property insurance premium went up $175,000 this year to $390,000.

“I’m supposedly somewhat lucky because I know others were worse than that,” Superintendent Brian Freeman said.

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