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Insurance losses from Mississippi tornado near $100M

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Insurance losses from the March tornado that carved a path of destruction through parts of Mississippi are approaching $100 million, and uninsured losses will likely exceed that number, the state’s insurance department announced Tuesday. The damage is particularly severe in the Mississippi Delta, one of the nation’s poorest regions.

The March 24 tornado lashed the Delta with winds of 200 mph, devastating the rural communities of Silver City and Rolling Fork. About 300 homes and businesses were destroyed in Rolling Fork, and 13 people were killed. Large parts of the northern Mississippi city of Amory were also damaged. According to the Mississippi Emergency Management Agency, approximately 380,000 cubic yards of debris have been cleared since the storm.

Mississippi Insurance Commissioner Mike Chaney says data is still being collected, but the trajectory toward more than $100 million in both insured and uninsured losses underscores the challenging rebuilding process awaiting hard-hit areas.

“We just hope and pray that we can resolve everything for these people,” Chaney told The Associated Press. “We’ve got some long leads, and what bothers us is that we have about 3,000 claims that are still open.”

A patchwork of different policies can delay the payment of claims by insurance companies. Chane’s office said that damage from tornadoes is covered under standard homeowner’s and business insurance policies, as well as some auto insurance policies.

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Rolling Fork is in Sharkey County, where the poverty rate is nearly 35%, nearly double Mississippi’s rate of 19% and nearly triple the nation’s rate of 12%. The whirlwind piled the region’s longstanding economic challenges on top of new pressures such as high inflation and rising interest rates.

Agriculture drives the local economy, with some families owning farmhouses and other properties that have been passed down through generations. As a result, heirloom property – or land passed from generation to generation without a will, where several people often share an interest in the property – becomes a challenge for cities in the delta. Landowners may have trouble collecting relief funds or insurance benefits without a clear title or legal deed, documents that may be irrevocable after a storm.

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“The challenge of heirloom property is a serious issue in Sharkey, Humphreys and Holmes counties,” said Ryan Thomson, professor of agricultural economics and rural sociology at Auburn University. “During disaster situations, many residents struggle to locate such files and have to rely on electronic records and community ties to validate their ownership.”

When tornadoes ravaged several Alabama counties in 2021, some people living in inherited homes had trouble getting Federal Emergency Management Agency help. Thomson said this forced many residents to abandon their family residences because there was no money to rebuild.

FEMA later changed its policy and now accepts other methods of proving property ownership, such as motor vehicle registration, court documents and letters from local organizations. Chane said there is some confusion about how many uninsured private residences FEMA will cover.

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President Joe Biden, who visited Rolling Fork after the tornado, approved a disaster declaration for Mississippi, freeing up loans to cover temporary housing, home repairs and non-insured property damage. The state legislature also approved nearly $18.5 million for tornado relief in the latest state budget.

The Red Cross is helping 533 Mississippi citizens with food and lodging at 37 hotels. As of April 17, the US Small Business Administration and FEMA had approved more than $12 million in aid, according to state officials.