Monroe Countys Mitigating Factors for Wind Damage Prepared

  • Slides: 69
Download presentation
Monroe County’s Mitigating Factors for Wind Damage Prepared by the Grassroots Organization FIRM Fair

Monroe County’s Mitigating Factors for Wind Damage Prepared by the Grassroots Organization FIRM Fair Insurance Rates in Monroe November 10, 2009

Argument Monroe County’s windstorm insurance rate increase should be denied. Actual experience indicates that

Argument Monroe County’s windstorm insurance rate increase should be denied. Actual experience indicates that claims paid in Monroe County are less than claims paid in other areas of the state. This is due to a variety of factors relating to: l Construction l Geography l Meteorology The proposed increase from Citizens Property Insurance Corporation should be denied because CPIC has not presented an actuarially sound rate that adequately addresses these verifiable factors. Monroe County has a history of building strong structures – a practiced being encouraged throughout the state – and this should be reflected in our windstorm insurance rates. 2 9/17/2020

Wind Rating Models Computer models are used to predict wind risk. l Models predict

Wind Rating Models Computer models are used to predict wind risk. l Models predict highest windstorm damage in Monroe County. l Actual hurricane wind experience does not support these high rates. Models inaccurately predict wind risk for Monroe County risk because: l Do not reflect Monroe County construction standards l Do not accurately model roof cover and sheathing l Overstate strike probabilities compared to other coastal areas l Do not accurately allocate damage from wind versus water (storm surge) 3 9/17/2020

Wind Rating Models (continued) Models are only as good as the data that is

Wind Rating Models (continued) Models are only as good as the data that is input into them. FIRM believes that data related to the issues in this presentation currently is not provided for Monroe County. 4 9/17/2020

Wind Rating Models – Garbage In, Garbage Out Because the data for Monroe County

Wind Rating Models – Garbage In, Garbage Out Because the data for Monroe County is inaccurate, the resulting rate indications are inaccurate. Yet OIR has no authority to challenge the fundamental model assumptions or verify input data. Garbage in, garbage out – and OIR has no way to clean it up. OIR Rate Approval 5 9/17/2020

CONSTRUCTION CONVENTIONS AND VULNERABILITIES ¢ ¢ ¢ ¢ 6 Modeling conventions Building codes Historic

CONSTRUCTION CONVENTIONS AND VULNERABILITIES ¢ ¢ ¢ ¢ 6 Modeling conventions Building codes Historic structures Roofs l Roof coverings l Roof-to-wall connections Site-built homes Garages Building height 9/17/2020

Assertion ¢ 7 Structural factors that reduce damage in Monroe are not properly modeled

Assertion ¢ 7 Structural factors that reduce damage in Monroe are not properly modeled and thus not accounted for in our rates: l Stronger building codes for a longer period of time l Sturdy historic structures in Key West l Superior sheathing and metal roof construction l Superior construction due to site-built homes l Lack of attached garages l Lower building height 9/17/2020

Modeling Conventions Computer models assign structures a strength classification based on a set of

Modeling Conventions Computer models assign structures a strength classification based on a set of assumptions regarding the building stock in the modeled areas. Strength Classification Garage Door Sheathing Nailing Roof to Wall Connections Roof Shape Opening Protection Weak (30 psf) 6 d (55 psf) Toe nails Gable or None or Hip Plywood Medium Weak (30 psf) 6 d (80 psf) Clips Gable or None or Hip Plywood Strong (52 psf) 8 d 130 psf) Straps Gable or None or Hip Plywood These assumptions do not take into account the realities of construction in Monroe County that create structures which exceed these parameters. 8 9/17/2020

Modeling Conventions (continued) Mitigation is the process of adding features to a home that

Modeling Conventions (continued) Mitigation is the process of adding features to a home that can help it better withstand damage from wind. The models assume all homes start “weak” and may or may not be mitigated to additional wind resistance standards. FIRM believes that: • Monroe County homes start out as “medium” or “strong” • Many mitigation features (such as shutters and hurricane straps) are required in Monroe County. • Because it is not in the insurance company’s financial interest to calculate and apply mitigation credits and thus reduce premiums, and because modelers acquire data primarily from insurers, homes hardened through mitigation may be underreported in the models. 9 9/17/2020

Building Codes ¢ 10 Monroe County has had the strictest building code for all

Building Codes ¢ 10 Monroe County has had the strictest building code for all construction (residential, commercial-residential, and commercial) in the state for the longest period of time. l As of 1982, the Standard Building Code required Monroe County to have the state’s highest windspeed rating for a 3 -second gust. l Since 2002, Monroe County structures have been constructed and renovated to withstand 150 MPH gusts. 9/17/2020

Building Codes (continued) Protective Coverings ¢ Shutters are the norm in the Keys, not

Building Codes (continued) Protective Coverings ¢ Shutters are the norm in the Keys, not the exception, and have been required for all new construction in Monroe since 1990. ¢ 59% of residents in a recent survey reported having shutters or impact-resistant windows; another 18% have some other (nonplywood) protective covering. ¢ Whether rated weak, medium or strong, models presume all structures have either no protective opening coverings or plywood alone, giving no additional value to other proven techniques such as shutters. SOURCE: FIRM online survey, September 2009 11 9/17/2020

Historic Structures ¢ ¢ 12 Key West is the most densely populated region of

Historic Structures ¢ ¢ 12 Key West is the most densely populated region of Monroe County. Key West has the largest collection of historic wood-frame homes (2, 350) in the country. These homes have withstood storms for well over 100 years due to specific construction conventions, including: l Pin and dowel joinery l Metal roofs l Sheer interior walls l Relatively low height l Heavy beams Further, at least half of these homes have been substantially reinforced during renovation with the addition of features such as hurricane clips, creating a much younger effective age than “age of home” (determined by original construction date) would suggest. 9/17/2020

Historic Structures (continued) ¢ ¢ 13 The Key West Hurricane of 1919 had winds

Historic Structures (continued) ¢ ¢ 13 The Key West Hurricane of 1919 had winds around 110 MPH. There are 252 homes in Key West standing today that survived the Hurricane of 1919. These homes also survived Hurricane Georges in 1998, again with 110 MPH winds. These historic frame homes have demonstrated that they exceed the FCHLPM definition of “weak” buildings because they have survived at least two 110 MPH storms. 9/17/2020

Roofs ¢ ¢ 83% of roofs in the Keys are younger than 20 years

Roofs ¢ ¢ 83% of roofs in the Keys are younger than 20 years old. 83% of roofs were installed when the Monroe County building code called for roofs to withstand 150 MPH 3 -second gusts. SOURCE: FIRM online survey, September 2009 14 9/17/2020

Roofs: Roof Coverings Metal Roofs ¢ Metal roofs have been proven to be more

Roofs: Roof Coverings Metal Roofs ¢ Metal roofs have been proven to be more wind-worthy than shingle or asphalt roofs which are standard in the Florida Building Code. l l l 15 Keys construction conventions require plywood rather than manufactured products as the sheathing material. Metal roofs are more impervious to UV degradation than other materials. V-crimp metal roofs do not produce wind-borne debris to the extent that shingle or tile roofs do. 9/17/2020

Roof Coverings – Metal Roofs (continued) ¢ ¢ There are more metal roofs in

Roof Coverings – Metal Roofs (continued) ¢ ¢ There are more metal roofs in Monroe County than any other roof type. To date in 2009, only one asphalt shingle roof was installed in the City of Key West. l l Between 2002 and 2006, 95% of roofs replaced in Key West were V-crimp metal roofs compliant with the FBC’s 150 MPH gust standards. Nearly one-third of all Key West roofs are under 10 years old. Roof Permits Issued in City of Key West: V-Crimp vs. Asphalt Type 1998 1999 2000 2001 2002 2003 2004 2005 2006 Total % V-crimp 392 559 285 307 312 230 210 458 528 3281 83. 3% Asphalt 205 252 70 38 19 21 23 10 21 659 16. 7% Total 597 811 355 345 331 251 233 468 549 3940 100. 0% 16 9/17/2020

Roof Coverings (continued) ¢ The Public Model, and perhaps Hurricane Loss Projection Methodologies, require

Roof Coverings (continued) ¢ The Public Model, and perhaps Hurricane Loss Projection Methodologies, require that roof covering be assumed to be on a weak sheathing considered to resist -55 psf when calculating roof covering mitigation. l 17 Therefore, superior metal roofs inappropriately receive no credit versus asphalt shingles. In the Keys, metal roof sheathing is typically installed to resist up to -183 psf. 9/17/2020

Roof Coverings (continued) ¢ ¢ Roof Coverings 61% of roofs county-wide are metal or

Roof Coverings (continued) ¢ ¢ Roof Coverings 61% of roofs county-wide are metal or poured concrete. The majority of roofs surveyed would be classified as very, very resistant to wind. SOURCE: FIRM online survey, September 2009 18 9/17/2020

Roof Coverings (continued) ¢ According to the FIRM survey, 51% of roofs have FBC

Roof Coverings (continued) ¢ According to the FIRM survey, 51% of roofs have FBC equivalent, reinforced concrete or ½” plywood or greater roof decks* l 36% have secondary water resistance l ¢ All models assume our pre-1970 homes are weak structures (similar to those in northern Florida) rather than “medium. ” *45% of respondents could not answer this question. SOURCE: FIRM online survey, September 2009 19 9/17/2020

Roof-to-Wall Connections ¢ Hurricane clips and straps have been the norm on new and

Roof-to-Wall Connections ¢ Hurricane clips and straps have been the norm on new and renovated frame and CBS construction since at least the 1950 s. l l l 20 Monroe Code as early as 1986 required roof to wall straps and wall to foundation connections/sill to pile connections and sheer walls. Code requires reinforced masonry walls, corners, headers, and vertical bars at windows and doors. Code requires that new homes are designed by licensed Professional Engineers or Architects. 9/17/2020

Roof-to-Wall Connections (continued) ¢ Many homeowners don’t know how their roofs are connected to

Roof-to-Wall Connections (continued) ¢ Many homeowners don’t know how their roofs are connected to their walls. According to informed homeowners, however: l l ¢ Just 6% of roofs are toe -nailed to the walls 43% of roofs have hurricane clips or straps Models assume that all homes are weak and have roofs that are toenailed. That is not the case in Monroe County. SOURCE: FIRM online survey, September 2009 21 9/17/2020

Roofs (continued) ¢ Keys superior roof systems and wind resistant design create a medium

Roofs (continued) ¢ Keys superior roof systems and wind resistant design create a medium to strong home which should be modeled. With nailing of 1 x 6 at 2. 5” on center and l 8” on center when transitioning to plywood l FBC requires all sheathing to be re-nailed during a re-roofing, so older homes in time will all be strong. l 22 9/17/2020

Site-Built Homes Tight controls on development (due to our status as an Area of

Site-Built Homes Tight controls on development (due to our status as an Area of Critical State Concern) have constrained the way homes are constructed. l l 23 There are no significant, mass-produced residential “developments” in the Keys. All new homes are designed by licensed Professional Engineers or Architects, per County code. The majority of new homes are built on site. Manufactured homes must meet the strictest standards for wind-resistance. 9/17/2020

Garages ¢ ¢ ¢ 24 Garages are a known weakness above 35 MPH winds.

Garages ¢ ¢ ¢ 24 Garages are a known weakness above 35 MPH winds. Garage doors create a particular vulnerability in hurricanes, as wind often enters through a garage door, creating uplift on the attached roof structure. The Public Model assumes all weak, medium, and strong homes have attached garages rated to withstand 30 psf, and 52 psf respectively. 9/17/2020

Garages (continued) ¢ Keys homes have few “attached” garages. l l l Fewer than

Garages (continued) ¢ Keys homes have few “attached” garages. l l l Fewer than 18% of homes in Monroe County have “attached garages”. 18% includes lower levels below the stilt home; not an attached garage. Many attachments are car ports, not under the home roof. Prevalence of Garages in the Florida Keys SOURCE: Monroe County Property Appraiser Data Classification single family residence duplex # of Properties Attached % of Garages* Homes 31, 726 5, 721 18. 00% 1, 822 141 7. 70% Detached % of Garages Homes 254 0. 80% 11 0. 60% *The ‘attached garage’ data includes all types of attachments including built-in lower level and true ground level attached garages. 25 9/17/2020

Garages (continued) ¢ ¢ ¢ Additional Structures Of homes surveyed, the great majority have

Garages (continued) ¢ ¢ ¢ Additional Structures Of homes surveyed, the great majority have no additional structures. Only 7% of survey respondents report having attached garages. Models assume that all structures start out “weak” and that an attached garage is part of what makes a home weak. Whether using survey data or data from the Property Appraiser, it is clear that homes in Monroe County do not have attached garages. SOURCE: FIRM online survey, September 2009 (see appendix) 26 9/17/2020

Building Height ¢ ¢ 27 Monroe County’s Comprehensive Plan places a 35 -foot limit

Building Height ¢ ¢ 27 Monroe County’s Comprehensive Plan places a 35 -foot limit on building height in the Keys. The only exceptions to this regulation are equipment towers and certain equipment on the roofs of commercial structures. According to a FIRM survey, 79% of homes are two stories or fewer. Most residential structures in Key West, the most densely populated area of the Keys, are under 25 feet tall. Wind speeds are measured at 10 meters, and intensify with increasing height. 9/17/2020

Construction Conundrum High Cost to Harden Home + High Cost Factor in Rate High

Construction Conundrum High Cost to Harden Home + High Cost Factor in Rate High Replacement Cost = High Premium because Hardened Home ¢ ¢ l l 28 Lower PML It costs us more to build sturdy homes. Insurance companies l ¢ ≠ Build high cost factors into the base rate Charge high replacement costs Do not reduce PML based on the lower risk from a hardened home Why bother building a sturdy structure? 9/17/2020

Summary ¢ ¢ 29 Structural factors that reduce damage in Monroe are not properly

Summary ¢ ¢ 29 Structural factors that reduce damage in Monroe are not properly modeled and thus not accounted for in our rates: l Stronger building codes for a longer period of time l Sturdy historic structures in Key West l Superior sheathing and metal roof construction l Lack of attached garages l Superior site-built construction l Lower building height No insurance incentive to harden home 9/17/2020

GEOGRAPHY ¢ ¢ 30 Population Density and Distribution Linear Geography Threat Zone Proximity to

GEOGRAPHY ¢ ¢ 30 Population Density and Distribution Linear Geography Threat Zone Proximity to Cuba 9/17/2020

Assertion ¢ 31 Geographic factors are ignored or inaccurately applied when factoring PML for

Assertion ¢ 31 Geographic factors are ignored or inaccurately applied when factoring PML for the Florida Keys. l Low population density l Lack of structures on largest land area in the County l Linear geography minimizes risk that any storm strike will impact entire Florida Keys l Threat zones drawn without consideration of Keys linear structure l Storms that cross Cuba tend to weaken before striking the Keys 9/17/2020

Population Density and Distribution Population in Monroe continues to decrease ¢ Density in Monroe

Population Density and Distribution Population in Monroe continues to decrease ¢ Density in Monroe is extremely low ¢ Monroe - 80 per sq mile l Collier - 124 per sq mile l Miami-Dade - 1158 per sq mile l Broward – 1374 per sq mile l ¢ 32 PML in Keys should be decreasing 9/17/2020

Population Density and Distribution (continued) ¢ The bulk of the land of Monroe County

Population Density and Distribution (continued) ¢ The bulk of the land of Monroe County is the unpopulated Everglades on the mainland. Storms that come within 62 statute miles of this area of the County could be over 200 miles from the populated area of the Keys. This should be taken into account when calculating proximity of land-falling hurricanes. Pale pink area represents Monroe County. Mainland area is in the Everglades. 33 9/17/2020

Linear Geography ¢ 34 Due to the linear geography of the populated Keys, it

Linear Geography ¢ 34 Due to the linear geography of the populated Keys, it is likely that a storm could impact one area of the chain and not impact another at all. PML calculations should take this into account. 9/17/2020

Threat Zones The Threat Zone circles on the Public Model for zip codes is

Threat Zones The Threat Zone circles on the Public Model for zip codes is rather large for Monroe. ¢ Hurricanes entering a circle on the mainland are likely to hit land cause damage. ¢ Hurricanes entering the circle in the western Keys are much less likely to hit land cause damage, and certainly not to the entire county or even adjacent zip code. ¢ 35 9/17/2020

Threat Zones (continued) x xxxxxxx x x x 36 xxxxxx The Florida Keys (inhabited,

Threat Zones (continued) x xxxxxxx x x x 36 xxxxxx The Florida Keys (inhabited, developed Monroe County) 11/11/13 9/17/2020

Proximity to Cuba ¢ The mountains of Cuba are 90 miles away from the

Proximity to Cuba ¢ The mountains of Cuba are 90 miles away from the Florida Keys. Mountainous regions create friction and generally reduce the intensity of storms that pass over them, and this has frequently been the case in the Keys. Ninety miles is too short a distance over open water for most storms to re-build in intensity. Florida Keys Cuba 37 9/17/2020

Summary ¢ 38 Geographic factors are ignored or inaccurately applied when factoring PML for

Summary ¢ 38 Geographic factors are ignored or inaccurately applied when factoring PML for the Florida Keys. l Low population density l Lack of structures on largest land area in the County l Linear geography minimizes risk that any storm strike will impact entire Florida Keys l Threat zones drawn without consideration of Keys linear structure l Storms that cross Cuba tend to weaken before striking the Keys 9/17/2020

METEOROLOGY ¢ ¢ 39 Strike Probabilities Wind versus Flood (storm surge) 9/17/2020

METEOROLOGY ¢ ¢ 39 Strike Probabilities Wind versus Flood (storm surge) 9/17/2020

Assertion ¢ 40 Meteorological factors that would indicate wind damage are misapplied when calculating

Assertion ¢ 40 Meteorological factors that would indicate wind damage are misapplied when calculating PML for the Florida Keys. l Monroe County does not have the highest risk in the State. l Models used to estimate losses do not adequately distinguish between damage from wind versus water. 9/17/2020

Strike Probabilities ¢ ¢ SOURCE: www. floridahurricane. net Slide 41 41 Strike Probabilities vary

Strike Probabilities ¢ ¢ SOURCE: www. floridahurricane. net Slide 41 41 Strike Probabilities vary based on data sets, time frames and other criteria used by statisticians. While Monroe County may be more vulnerable to tropical activity than other areas, the magnitude of the difference in vulnerability is not as great as models and windstorm insurance rates would suggest. 17 September 2020 9/17/2020

Strike Probabilities: Return Frequency by Category in Key Coastal Areas per FSU According to

Strike Probabilities: Return Frequency by Category in Key Coastal Areas per FSU According to an historical study by Florida State University, low intensity storms occur in the Keys about as frequently as in panhandle counties, and higher intensity storms occur more frequently in other southeast Florida counties than in Monroe. Note that according to this study, no Category 5 storms occurred anywhere other than Monroe. Hurricane Andrew was a Cat 5 storm that hit Miami-Dade in 1992. Data used in modeling should be fully vetted for accuracy. All Tropical Storms Cat 1 & Higher Cat 2 & Higher Cat 3 & Higher Cat 4 & Higher Cat 5 & Higher Monroe 4 9 14 20 78 156 Bay/Gulf/Franklin 4 9 22 78 0 0 Miami-Dade/ Broward/Palm Beach 6 12 16 20 26 0 Collier/Lee 7 22 31 39 156 0 Martin to Brevard 12 14 20 52 156 0 SOURCE: Data extrapolated from maps of storms by frequency at FSU study online at http: //gis. coaps. fsu. edu/httpdocs/Rtrn. php Slide 42 42 9/17/2020

Strike Probabilities: Return Frequency by Category in South Florida per CSU Data from a

Strike Probabilities: Return Frequency by Category in South Florida per CSU Data from a Colorado State University study of storms between 1900 and 2006 paints a different picture for strike probabilities in the Keys. However, this study includes the large, unpopulated and uninsured portion of Monroe County that is on the mainland. Region or County Probability of 1 or More Named Storms Making Landfall in the Region Probability of 1 or More Hurricanes Making Intense Hurricanes Making Landfall in the Region 6 50. 4 39. 4 20. 5 Monroe 32. 0 24. 1 11. 8 Miami-Dade 12. 0 8. 8 4. 1 Broward 5. 6 4. 1 1. 9 Palm Beach 8. 9 6. 4 3. 0 Martin 3. 4 2. 5 1. 1 SOURCE: United States Landfall Probability Webpage By Philip Klotzbach and William Gray, Colorado State University, With Assistance From Uma Shama, Larry Harman, and Daniel Fitch, Geo. Graphics Laboratory, Bridgewater State College, http: //www. etransit. org/hurricane/Full%20 Data%20 Table. xls Slide 43 43 9/17/2020

Wind vs. Flood (Storm Surge) ¢ ¢ ¢ The Keys are a low-lying chain

Wind vs. Flood (Storm Surge) ¢ ¢ ¢ The Keys are a low-lying chain of islands, with the highest elevation at 14 feet. (1) According to meteorologists at the National Weather Service, the greatest threat to the Keys from Category 3 and higher hurricanes predicted by SLOSH models is from storm surge, not wind. Any wind damage that would occur would be washed away by the surge. (2) Thus, flood insurance would pay first and most for the greatest portion of damage occurring from a significant hurricane. Wilma, a storm many consider to be the “ 100 -year storm, ” demonstrated this. (1) NOAA Satellite and Information Service, http: //lwf. ncdc. noaa. gov/oa/reports/georges. html (2) Matt Strahan, Meteorologist in Charge, National Weather Service, Key West Slide 44 44 17 September 2020 9/17/2020

Wind vs. Flood: Claims Paid in Monroe County ¢ ¢ After Hurricane Wilma, flood

Wind vs. Flood: Claims Paid in Monroe County ¢ ¢ After Hurricane Wilma, flood insurance paid 14 times more in claims than wind insurance did. Flood claims for Hurricane Wilma alone exceeded all wind claims paid in 2005 for four named storms (Dennis, Katrina, Rita, Wilma). (1) Citizens Property Insurance as of February 28, 2006 (2) National Flood Insurance Program as of 6/30/09 (3) Citizens Property Insurance as of July 2008 45 9/17/2020

Wind vs. Storm Surge Losses: Inundation by Hurricane Strength Most of the Florida Keys

Wind vs. Storm Surge Losses: Inundation by Hurricane Strength Most of the Florida Keys would flood in a storm of Category 2 or greater. A Category 3 or higher storm would cause significant flood damage. SOURCE: Monroe County Emergency Management Slide 46 46 17 September 2020 9/17/2020

Wind vs. Storm Surge Losses: SLOSH Model ¢ Storm surge predictions are generally based

Wind vs. Storm Surge Losses: SLOSH Model ¢ Storm surge predictions are generally based on the SLOSH Model. Prior SLOSH models do not necessarily work in the Keys. l l l The SLOSH model covers inland areas. The Keys have none. The SLOSH model does not take into account the wave action that we experience in the Keys due to our low elevation. Experience in direct-hit storms bears this out: Storm SLOSH Predicted Surge Actual Experienced Surge Not Named 1919 8 feet 14 feet Not Named 1935 9 feet 20 to 24 feet Hurricane Donna 8 feet 12 to 14 feet Models predicting surge based on the older SLOSH model may underpredict flooding in the Keys, thus leading to over-prediction of wind damage. SOURCE: Matt Strahan, Meteorologist in Charge, National Weather Service, Key West 47 9/17/2020

Wind vs. Flood Damage by Category Cat 1 2 3 4 Wind (mph) 74

Wind vs. Flood Damage by Category Cat 1 2 3 4 Wind (mph) 74 -95 96 -110 111130 Damage Extent Minimal Moderate Extensive 131155 Extreme Surg e (feet) Damage Description 4 -5 No real damage to building structures. Damage primarily to unanchored mobile homes, shrubbery, and trees. Also, some coastal road flooding and minor pier damage. 6 -8 Some roofing material, door, and window damage to buildings. Considerable damage to vegetation, mobile homes and piers. Coastal and low-lying escape routes flood 2 -4 hours before arrival of center. Small craft in unprotected anchorages break mooring. 9 -12 Some structural damage to small residences and utility buildings with a minor amount of curtainwall failures. Mobile homes are destroyed. Flooding near the coast destroys smaller structures with larger structures damaged by floating debris. Terrain continuously lower than 5 feet ASL may be flooded inland 8 miles or more. 1318 More extensive curtainwall failures with some complete roof structure failure on small residences. Major erosion of beach. Major damage to lower floors of structures near the shore. Terrain continuously lower than 10 feet ASL may be flooded requiring massive evacuation of residential areas inland as far as 6 miles. Complete roof failure on many residences and industrial buildings. Some 48 5 Source: *The COMET® Program, part of the University Corporation for Atmospheric Research’s complete building failures with small utility buildings blown over or away. 9/17/2020 (UCAR’s) Office of Programs (UOP). >155 Catastroph ic >19 Major damage to lower floors of all structures located less than 15 feet ASL and within 500 yards of the shoreline. Massive evacuation

Estimate of Wind vs. Surge Damage by Storm Strength Key West Average Storm Tide**

Estimate of Wind vs. Surge Damage by Storm Strength Key West Average Storm Tide** Vs. Storm Category for Average 1000 SF home Hurricane Average Storm Tide in feet Average Ground floor in feet Average Flood in Home in feet FL Public Model Wind Damage Ratio* % Water Damage* Estimated Cost of Wind Damage*** Estimated Cost of Flood Damage*** $177, 500 to $242, 500 Cat 5 10. 4 5. 5 4. 9 14 -37% 71 - 97% $35, 000 to $92, 500 Cat 4 9. 1 5. 5 3. 6 5 -14% 59% $35, 000 $147, 500 Cat 3 7. 5 5. 5 2 3 -5% 49% $1, 250 $122, 500 *Source: FL Public Model presentation June, 2009, extrapolated estimate by FIRM Engineer based on Masonry Structure Vulnerability slide No. 81 **15 mph forward speed, tide 2 ft NGVD 1929, Calculated by SLOSH Model *** Based on FL Public Model presentation June 2009, slide 98. 49 9/17/2020

Estimate of Wind vs. Surge Damage by Storm Strength This chart combines data from

Estimate of Wind vs. Surge Damage by Storm Strength This chart combines data from http: //www. comet. ucar. edu/nsflab/web/index. htm (COMET) and the FPHM model and is a representation estimating storm surge versus wind damage. If, for example, construction experts state that a home is considered totaled at 25% damage loss, that would occur from flooding due to 135 mph wind, whereas windonly damage from 135 mph wind would only be 15%. This would indicate that FEMA would pay those claims for damage above 130 mph winds. Storm Characteristics FIRM Estimate of Damage Ratio % CATEGORY Wind Speed (mph) Surge Depth (ft) Surge * Wind * * 1 74 -95 4 -5 5% 0% 2 96 -110 6 -8 30% 1% 3 110 -130 9 -12 60% 5% 4 131 -155 13 -18 80% 15% 5 >155 >19 90% 18% SOURCE: http: //www. comet. ucar. edu/nsflab/web/index. htm and the FPHM model; Extrapolated estimate prepared by FIRM retired engineer Al Sachs 50 9/17/2020

Wind/Flood Damage Probable Maximum Loss (PML) Argument ¢ ¢ 51 The Florida Keys in

Wind/Flood Damage Probable Maximum Loss (PML) Argument ¢ ¢ 51 The Florida Keys in Monroe County are a low lying area with elevations from 5 feet or less to a high in Islamorada of about 11 feet. A small section of Key West rises to no greater than 18 feet. Because of this most residents carry both flood and wind insurance but depending on conditions either one or the other will pay for the damage. For example, Wilma was a Category 3 storm, but FEMA paid for the widespread flood damage while wind damage claims were minimal. We believe that, since not all claims will be paid by the wind insurer, this fact should be reflected in our wind rates. The new SLOSH model from the National Weather Service may provide a vehicle for more accurately predicting damage due to wind versus water. 9/17/2020

Storm Surge and Wind Combination Model Prepared by Matt Strahan Meteorologist in Charge, NWS

Storm Surge and Wind Combination Model Prepared by Matt Strahan Meteorologist in Charge, NWS Key West May 26, 2009 52

Storm Surge Defined STORM SURGE is an abnormal rise of water generated by a

Storm Surge Defined STORM SURGE is an abnormal rise of water generated by a storm, over and above the predicted astronomical tide. STORM TIDE is the total water level during a storm (i. e astronomical tide + storm surge) 53

The Effects of Low Pressure • Lower central pressure associated with the storm causes

The Effects of Low Pressure • Lower central pressure associated with the storm causes the ocean to rise/bulge up • However, the contribution of pressure to total storm surge is small compared to wind 54

What about Waves? • Breaking waves also contribute to the total water level through

What about Waves? • Breaking waves also contribute to the total water level through wave runup/setup • Wave runup is the time-varying fluctuation of water-level elevation at the shoreline due to wave breaking • Wave setup the time-averaged water level rise due to wave breaking. • The magnitude of both runup and setup are related to offshore wave period, wave height, and shelf slope 55

NHC Storm Surge Products • Maximum Envelope of Water (MEOW) • Maximum of MEOW

NHC Storm Surge Products • Maximum Envelope of Water (MEOW) • Maximum of MEOW (MOM) • Probabilistic Storm Surge Heights • Deterministic/Operational SLOSH Runs • Public Advisory Statement 56

Deterministic SLOSH run shows limited surge threat to Pensacola area Rmax=25 mi (forecast) 57

Deterministic SLOSH run shows limited surge threat to Pensacola area Rmax=25 mi (forecast) 57 Surge Based on NHC -12 hr. Advisory

Probabilistic product shows considerable surge threat to Pensacola area 58

Probabilistic product shows considerable surge threat to Pensacola area 58

Actual storm caused highest surge in Pensacola area 59

Actual storm caused highest surge in Pensacola area 59

Storm Surge What does a 20 -foot storm surge really mean to your location?

Storm Surge What does a 20 -foot storm surge really mean to your location? Storm surge models output water surface elevations for a specific area (grid cell) Water Surface Elevation = 20 -foot surge* 20 foot contour Depth of water = 0 feet Depth of water = 5 ft Depth of water = 10 ft 15 foot contour Depth of water = 15 ft Depth of water = 20 ft 10 foot contour 5 foot contour 0 foot elevation land/sea interface *This only represents surge. There may be waves on top of the surge. 60

Key West Inundation Map Source - FL Dept of Emergency Management Cat 1 Cat

Key West Inundation Map Source - FL Dept of Emergency Management Cat 1 Cat 2 -3 Cat 4 -5 Dry 61

Calculating Wind vs. Water Risk • Start with SLOSH grids in Velocity Zones (predefined

Calculating Wind vs. Water Risk • Start with SLOSH grids in Velocity Zones (predefined areas of rapidly moving surge). • Rerun all the Cat 3 (high wind damage storms) and higher MEOWS – For each grid cell, what percentage of tracks is the cell both crossed by the RMW (maximum wind damage location) and also inundated? – Reduce wind rates by the above percentage. • But…wait for soon to be released SLOSH. • But…SLOSH does not natively do the above (Additional programming will be necessary). 62

Wind vs. Storm Surge Losses In the Keys, hurricane damage resulting from flood, water

Wind vs. Storm Surge Losses In the Keys, hurricane damage resulting from flood, water and storm surge can far exceed damage caused by wind. We believe that, since not all hurricane damage claims will be paid by the wind insurer, this fact should be reflected in our wind rates. l Homes may be washed away with no subsequent wind claims paid, this fact should be reflected in our wind rates. l 63 9/17/2020

Summary ¢ 64 Meteorological factors that would indicate wind damage are misapplied when calculating

Summary ¢ 64 Meteorological factors that would indicate wind damage are misapplied when calculating PML for the Florida Keys. l Monroe County does not have the highest risk in the State. l Models used to estimate losses do not adequately distinguish between damage from wind versus water. 9/17/2020

CONCLUSION Citizens Property Insurance Corporation is a taxexempt, quasi-governmental entity providing insurance as a

CONCLUSION Citizens Property Insurance Corporation is a taxexempt, quasi-governmental entity providing insurance as a last resort. ¢ Citizens Property Insurance rates should not need to include cost factors for ¢ taxes l marketing and advertising expenses l shareholder dividends l private reinsurance surcharge l 65 9/17/2020

CONCLUSION (continued) ¢ ¢ 66 Actual historical evidence indicates that Monroe County is not

CONCLUSION (continued) ¢ ¢ 66 Actual historical evidence indicates that Monroe County is not the riskiest county in the state. Structural factors that reduce wind damage in Monroe County are not properly modeled and thus not accounted for in our rates. Geographic factors are ignored or inaccurately applied when factoring PML for the Florida Keys. Meteorological factors that would indicate wind damage are misapplied when calculating PML for the Florida Keys. 9/17/2020

CONCLUSION: Wind Rating Models – Garbage In, Garbage Out Because the data for Monroe

CONCLUSION: Wind Rating Models – Garbage In, Garbage Out Because the data for Monroe County is inaccurate, the resulting rate indications are inaccurate. Yet OIR has no authority to challenge the fundamental model assumptions or verify input data. Garbage in, garbage out – and OIR has no way to clean it up. And due to legislative changes in 2009, the FCHLPM will only review models in odd years. OIR Rate Approval 67 So even if the data is inaccurate or a model is misapplied, OIR and consumers must live with the garbage for at least two years. The next review cycle is 2011. 9/17/2020

Precedent for Special Consideration for Monroe ¢ 68 There is considerable legislative and operational

Precedent for Special Consideration for Monroe ¢ 68 There is considerable legislative and operational precedent for treating Monroe County separately. l Since 1973, Monroe County has been designated an Area of Critical State Concern, subject to unique development regulations. l The Pilot Project in 2006 allowed the Office of Insurance Regulation to consider Monroe County’s insurance rates differently, as there was no reasonable degree of competition for windstorm insurance in the County. l The Florida Public Hurricane Model currently includes Monroe County as a separate area. 9/17/2020

FIRM’S REQUEST ¢ 69 We respectfully request that the proposed windstorm rate increases from

FIRM’S REQUEST ¢ 69 We respectfully request that the proposed windstorm rate increases from Citizens Property Insurance Corporation be denied as being unsupported and unfairly discriminatory, and the Florida Commission on Hurricane Loss Projection Methodologies conduct a full review of the Florida Public Hurricane Model with regard to the aforementioned realities, before OIR accept a rate as truly “actuarially sound. ” 9/17/2020