Mayor A.J. Holloway and the city’s insurance broker had good news for the Biloxi City Council this afternoon: The city’s property insurance rate for next year is expected to be as much as 25 percent below existing rates.
And Holloway is also recommending that the City Council take advantage of the lower rate to purchase $50 million worth of insurance, which double the amount of wind coverage to fully cover city facilities, add $10 million in supplemental flood coverage and purchasing a $10 million business-interruption insurance policy — for an additional $289,000.
The business-interruption insurance, which would replace the city’s lost gaming revenue in the event of a storm, is a follow-up to a pre-Katrina idea that earned the city $10 million a $92,000 investment.
However, four councilmembers — George Lawrence, David Fayard, Mike Fitzpatrick and Charles T. Harrison Jr. — voted to table the issue until Monday so they could further review the proposal. The city’s property insurance is scheduled to expire on the next day, on July 1.
“We’d rather have done this earlier, but the rates were not available,” Holloway said. “Our insurance broker, Stewart Sneed Hewes, has worked hard to get us the best rates possible, and I think the extra time has worked in our favor. More importantly, I’m hopeful that these numbers are indicative of an overall softening of the insurance market in Biloxi and on the Gulf Coast.”
Wayne Tisdale of Stewart Sneed Hewes said for $1.15 million the city could purchase the same level of coverage as found last year for $1.54 million. That plan included $31.5 million in wind coverage, and more than $6.5 million in flood coverage.
However, under Holloway’s plan the city would spend an extra $289,000 over the existing cost to provide total wind coverage ($59 million), more than $16 million in flood coverage and a $10 million in business-interruption coverage.
