Posted: Tuesday, January 15th 2013 at 12:03am
Some Habersham homeowners see insurance premiums skyrocket
By Rob Moore Editor
Tolbert Bramlett, who lives just outside Cornelia, said his homeowner's insurance premiums went from $1,200 per year to more than $5,000 per year as a result of ISO ceasing to recognize fire subscriptions. (Photo/Rob Moore)
CORNELIA – Some Habersham County residents got sticker shock when they received their latest homeowner’s insurance premium notices. Others got notices of possible insurance cancellation.
That’s because ISO, a third-party grading entity that advises the insurance industry on risk and other factors, no longer recognizes subscription fire protection.
Before Habersham County had a county fire department, there were community volunteer fire departments in the unincorporated areas. Baldwin, Clarkesville, Cornelia, Demorest, and Tallulah Falls provided fire protection to those cities, with some offering subscriptions to those in nearby unincorporated areas of the county for an annual fee.
By subscribing, those residents and businesses were able to take advantage of a lower ISO rating, thus paying lower insurance premiums.
Habersham is one of only two or three counties in Georgia that still has fire subscribers. County Manager Janeann Allison puts that number at about 1,800 subscribers countywide.
"Cornelia has the most subscriptions by far," Allison said.
Now, ISO has decided not to recognize fire subscriptions, prompting some insurance providers to raise premiums or discontinue coverage.
Because of the criteria used to determine ISO protection classes, there is not an easy remedy to help those property owners affected.
Habersham County was notified last year that its ISO rating improved from a 6 to a 5 in areas within five miles of a county fire station. Homes and businesses located farther than five miles of a county fire station are rated at a 10.
A secondary factor is the availability of water to fight fire. Homes and businesses that are within five miles of a fire station but that don’t have adequate public water within 1,000 feet generally receive a Class 9.
Cornelia offers an ISO rating of 4 to its residents and, through a contract with Mt. Airy, to residents of that town.
Cornelia and Habersham County officials jointly hosted a town hall meeting at the Cornelia Community House Monday night to discuss the dilemma. That meeting was attended by all five county commissioners and two Cornelia city commissioners.
Allison assured residents that if they currently subscribe to a city fire department, that department will continue to respond, but it is the insurance company’s discretion whether to continue charging the same premiums.
She listed five options being discussed:
1. Status quo, where no changes are made in the system and residents continue to pay a fire subscription, but don’t necessarily receive insurance benefits.
2. Subdivisions with a homeowners association that agrees to contract for fire protection with a city. A subscription for a subdivision with unanimous participation through its HOA would be recognized by ISO because it involves a geographic response area.
3. Fire districts, where each fire department in the county (city and county) would have a response district without respect to city boundaries.
4. Annexation into Mt. Airy or Cornelia for those eligible by contiguity to existing city limits or city-owned property.
5. Automatic aid, an intergovernmental agreement guaranteeing a response by the closest station (including cities) without respect to city limits. Currently Habersham County has automatic aid agreements with Baldwin and Tallulah Falls.
Barbara Bramlett asked Allison about the possibility of the county building another fire station to cover the unincorporated area outside Cornelia and Mt. Airy.
Allison said that is not a short-term option because of the expense involved in the facility, purchasing equipment, and hiring the personnel to staff it.
Huey Patterson Jr., who lives in the affected unincorporated area, acknowledged “this is not an issue that can be readily solved.”
Asked about the effects of automatic aid, Cornelia City Manager Donald Anderson said the loss of subscribers almost certainly would result in a reduction of personnel at Cornelia Fire Department.
Cornelia Fire Chief Frankie Smith agreed, noting that should an automatic aid agreement be approved without additional compensation from the county, “we’re either going to have to cut personnel … or go up on taxes in the city, and I’m sure the city’s not going to do that.”
Some county residents argued it’s not fair for them to pay the same taxes paid by other taxpayers who have an ISO rating of 6 if they don’t receive the same benefit.
Currently, a Cornelia fire subscriber pays $87 per year.
“ISO came in here and screwed all this up,” Tolbert Bramlett said.
“This has been festering for years and years,” said Habersham County Fire Chief Jeff Cain.
“We would much rather this have not become an issue,” Anderson said.
Panel members said ISO no longer will evaluate individual subscribers, which is the reason the firm only recognizes geographic areas.
“They’re in it to make money just like everybody else,” Cain said.
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