Herbie Wiles Insurance

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Insurance Blues

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The ones that remained are trying to keep from going broke by raising their rates.

State Farm Insurance, with 23 percent of the state's market, got regulator permission recently to increase rates an average of 52.7 percent, with Miami-Dade homeowners paying a 142 percent increase, Broward 130 percent, Palm Beach County 127 percent and Collier County 90 percent.

Nationwide Insurance also requested permission to raise its rates. They'd like an average of 70 percent.

According to a Tampa Tribune story, Allstate Floridian Insurance Co., the state's second largest insurer, plans to dump 120,000 homeowner policies and 35,000 mobile home policies soon. That brings Allstate's total of dumped policies to 370,000.

With two coasts and a Panhandle that serves as a catcher's mitt for Gulf hurricanes, Florida obviously has a much higher risk than other states of experiencing catastrophic windstorm damage.

On top of that, more people are seeking homeowners insurance policies due to chronic growth.

And with a diminishing number of companies providing coverage, it seems clear that premium costs will rise and coverage will be tougher and maybe impossible to get.

What went wrong

"Florida's insurance structure is broken. I don't think it will ever be like it was," State Rep. William Proctor said. "The 2004-2005 hurricane season was a watershed for windstorm insurance in Florida. Seven private insurance companies have recently pulled up stakes."

Eight named storms hit Florida during 2004 and 2005, causing $30 billion to $39 billion in losses. Claims ate up the cash reserves of most insurance companies and wiped out the state's Catastrophic Insurance Fund. About $2 billion of the hurricane claims are still not paid off, Proctor said.

"A lot of policies are not being renewed," he said. "Even those companies staying in the state are becoming increasingly cautious about who to insure."

Some lenders or mortgage companies now require that a buyer buy an insurance policy before they close on their house, Proctor said.

The law says that if a private insurance company cannot be found, a home owner may get insurance from the state-run company, Citizens Property Insurance Corp., formed in 2002. Citizens, however, must charge the highest rates.

However, it also ends up with the highest risk customers, such as those living in older, mobile or coastal homes. Citizens has been processing 40,000 to 50,000 new policies a month and now covers 1.2 million policy holders in Florida, Proctor said.

"It provides people coverage, but there's a flaw in that plan. The whole principle of insurance is to split the overall risk among many companies so no one company takes all the hit. Citizens, however, is collecting the risk in one place," he said.

It now has an exposure of about $230 billion, he said. Some estimates think it's $400 billion. "In a worst-case scenario, a mega-storm that hits Miami, goes through the state and comes out at Tampa could bankrupt Florida," Proctor said.

Another looming problem for the industry is the lack of re-insurance, which is coverage that insurance companies buy in case they suffer more losses than they can handle. Re-insurance companies were hit hard in 2004-2005 and fewer are doing business in Florida.

"If (a Florida insurance company) can get re-insurance coverage for a year, they are lucky," Proctor said.

Effects on homeowners

The 2004 and 2005 storms caused Citizens' high-risk account to default by about $1.8 billion. It insures 5,500 homes with values of $1 million or more.

By law, Citizens' adds a surcharge to every renewal policy. And its losses must be billed to ot

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For Some, Eye-Popping Rate Hikes 'Ridiculous'

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The owners of a Dobbs Road condominium office complex last year paid $8,400 for insurance for their 19 units.

But this year, they were stunned to be assessed about $40,000, an almost five-fold increase.

Joe Ruggeri, owner of a home remodeling company and owner of a unit there, said that much of a premium rate hike is "absolutely ridiculous," but said he and other owners will probably pay. The units are worth $200,000 each and need coverage.

"While we talked about this, I kept thinking that Dobbs Road has nothing else but these kind of units," Ruggeri said. "This hike will certainly affect small businesses. If I were a renter, my landlord would tack $2,000 onto my rent. That could push somebody out of business."

All over St. Johns County, owners are being forced to pay more for home insurance, if they can get it.

For example:

Former St. Augustine Mayor Len Weeks said that when he sold the Florida Cracker Cafe on St. George Street, he kept ownership of the building that it was in.

The new owner sought insurance and Weeks had to find new insurance for his building - minus the cafe.

"We worked for more than a month to find a policy," he said. "We got one, but it was way more than doubled than what we were paying and the coverage isn't as good."

Insurance companies now don't want to insure anything within a mile of the ocean, Weeks said. "You can't buy or sell anything in St. Augustine that isn't within a mile of the ocean," he said.

Doug Wiles, former District 20 state legislator and president of Herbie Wiles Insurance in St. Augustine, said one St. Augustine Beach shopping center paid a premium of $16,000 last year. But this year, its policy was not renewed. The owners sought but could not find insurance from a well-known company and finally signed with a company that requires a $75,000 premium up front, not allowing monthly payments. Even worse, this carrier policy does not insure against hurricane damage.

Phil Jacobs of Jacobs, Jacobs & Associates, a condo and property management firm, says beach lovers buy condos believing they are comfortable seaside homes that require little maintenance or expense.

But one of his client condos was shocked in July when the owners received special assessment bills ranging from $900 to for $2,000, depending on the size of the unit. This payment was not their individual unitÌs insurance cost, but covered only the common areas. Jacobs declined to identify the condo, but said some owners did question whether it was worth staying.

"Rising insurance rates are going to affect the selling of these units," Jacobs said. "It could drive a lot of people away from condos."

Wiles offered three more examples. One St. Augustine Beach homeowner paid $1,900 a year for $300,000 in coverage. His policy was not renewed and a new company is charging him $3,300 a year.

In the second instance, a local equipment dealer's policy was not renewed by his carrier. The company owners signed with a different company at more money, but they don't have hurricane coverage now.

In the third instance, a local hotel here had been paying $30,000 a year for coverage. That policy was canceled and the best estimate the owners could get is $100,000 a year.

"He turned it down and chose to self-insure," Wiles said.

Herbie Wiles Insurance is building a new headquarters on U.S. 1, but Doug Wiles said that building's coverage had been canceled, as well as the one covering his home. He's aware of the sad irony of an insurance agent not being able to get insurance.

"We're no different than anybody else in today's market," Wiles said. "We're all in this together."

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Moving Day: Victorian Homes Find New Purpose as Museum

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Familiar landmarks, a pair of century-old white Victorian homes, traveled through St. Augustine streets Sunday morning. They were on their way to become part of a historic village of rescued homes on the property of the Old Jail.

The houses, which served as the offices of Herbie Wiles Insurance, 400 N. Ponce de Leon Blvd., for about 40 years will be converted into a late-1800s general store museum.

"We're just delighted to know we'll be able to drive by the Old Jail and see the old office," said Doug Wiles, president of Herbie Wiles Insurance.

About a year ago, he began looking into options for the buildings to accommodate the expanding business.

"It was a priority to Herbie Wiles and to me and to our staff to preserve the buildings," Doug Wiles said. "The current office has really become a part of the Wiles family."

Doug Wiles is a third-generation insurance agent. His grandfather was the first State Farm agent in the area in the 1940s. After Doug's father, Herbie, graduated from college, he, too, worked as a State Farm agent until the 1960s when his dad died.

At the time, State Farm was undergoing changes that Herbie Wiles decided were not for him so he opened his own company that now serves more than 9,000 businesses and families.

In 1966, Herbie Wiles renovated the first house, an 1899 single-family residence. It was termite infested and in rough shape, but he wanted to preserve the historic home, Doug Wiles said. The second house, built between 1904 and 1907, was renovated and united with the first in 1980. Sunday morning, the Wiles family and staff members gathered to bid the office farewell.

"It's a little sad that we're gonna have to say good-bye," Doug Wiles said.

The new building will have a similar look, but will be bigger and designed to sustain 120-mph winds, Doug Wiles said.

It will also have emergency power, so in case of a hurricane, the company will be able to get up and running quickly to assist customers, he added. Construction will take about a year. During that time, offices have been temporarily relocated across the street at 77 Saragossa St.

The old office will soon be part of the Heritage Square interpretive complex on the property of the Old Jail on San Marco Avenue, said Dana Ste. Claire, national director of museum services for Historic Tours of America Inc. Plans to build a museum on the site were first brought up in 2003.

And in late 2004, they realized they could do it by saving and restoring turn-of-the-century homes. Each of the five homes they have acquired will be set up as vignette museums with slices of early St. Augustine/American life, Ste. Claire said. "It becomes more of a destination than a singular attraction," Ste. Claire said.

The move took about five hours and cost about $150,000, Ste. Claire said. Historic Tours paid for it with some help from the Wiles family and companies that assisted in the transfer.

The office that will soon become a general store museum will likely be open in late summer or early fall. Some of the other homes in the collection, which require more renovation, may take until the end of the year before opening, Ste. Claire said.

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Roads Closed for Home Relocations

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Part of U.S. 1, Castillo Drive and San Marco Avenue will be closed Sunday morning while a pair of century old homes are relocated.

To preserve the Herbie Wiles Insurance building, 400 N. Ponce de Leon Blvd., it will be moved to the Old Jail property on San Marco Avenue between 7 a.m and 1 p.m. Sunday.

By 10 a.m. the houses are expected to be on San Marco Avenue.

St. Augustine Police Department officers will be rerouting traffic.

Parking along San Marco will be restricted beginning Saturday night.

Residents in the area may experience temporary power and telephone interruptions, according to city officials.

The insurance agency has relocated to property across Saragossa Street from the agency's former location.

The agency plans to build a new office building where the old one stood, according to Doug Wiles, agency president.

Wiles said parking will continue to be available in the parking lot that fronts on North Ponce de Leon Boulevard.

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Agency Plans to Move

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Herbie Wiles Insurance informed its customers this week that the agency is moving to temporary quarters as plans gel for a new building at 400 N. Ponce de Leon Boulevard.

Doug Wiles, president, said the company has outgrown the present building.

The building was built as a single-family residence in the early 1900s. It was remodeled by the agency for use as an office.

Wiles said Dana Ste. Claire, national museum director for Historic Tours of America, expressed an interest in the building for the company's Old Jail complex. He said Ste. Claire told him the building will be used for offices and museum space.

Wiles said the building will be moved in late January or early February. He said the agency's staff will move in early January to 77 Saragossa St., across the street from the current building. He said the agency's phone numbers and mailing address will not change.

Wiles said the agency has been at the Ponce de Leon location since 1966. His father, Herbie Wiles, is the CEO of the agency he founded in 1961.

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Editorial: A Little More History Saved by Partnership

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Because neither our city nor county enjoy programs financially dedicated to preserving properties deemed historic, it's easy to believe it just doesn't happen. And, certainly, it does not happen nearly enough. It's sad that our future continues to feed on our past in terms of the number of historically significant buildings that fall each year to the wrecking ball of growth.

When we do see successful efforts on a small scale, we (the newspaper or the community) tend to miss the happening or overlook the labor involved in accomplishing it.

So we'd like to back up a step or two and give a little credit where it's due.

A week ago Sunday some motorists' eyebrows may have been raised by the sight of two large halves of the former Herbie Wiles Insurance building being trucked north from their home of 40 years on Ponce de Leon Boulevard, to a "retirement home" of sorts on the property of the Old Jail.

The old insurance office was comprised of two older homes built around 1899 and 1907. They were sandwiched together to construct the office(s) -- and were subsequently taken back apart for the move.

The buildings could have easily been demolished to make room for the needed expansion and upgrades of the office. But they were not. And that's the point we want to drive home today.

A partnership between Herbie Wiles Insurance and Heritage Tours of America was the mechanism that began six months ago and ultimately saved the old homes. It was private business that made it work. Historic Tours does benefit from its role. The homes will become a part of it Heritage Square complex where four other homes -- most recently the Mary Peck House -- have been moved, saved and are being restored for admittedly commercial use there. But HTA could have probably built recreations more economically to accomplish the same results. Herbie Wiles Insurance had reasons of its own, though simpler. Doug Wiles said his family's interest was more personal; "We just didn't want to tear down 'The House That Trust Built,'" referring to the business slogan.

Whatever the impetus for saving the old homes, the benefit is clearly larger in our community than for these two parties. We appreciate their efforts at finding a home for the old wooden "orphans" and putting them where thousands can enjoy them in the future.

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