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Twp with Excessive Snow Insurance Policy!

Discussion in 'Commercial Snow Removal' started by BRL, Mar 12, 2003.

  1. BRL

    BRL PlowSite.com - Veteran
    Messages: 1,277

    Woodbridge, NJ bought a snow insurance policy after the Blizzard of 96. If a season brings over 50 inches of snow, they receive $15,000.00 per inch thereafter from the policy. The catch is for each year the premium is around $17,000 - $19,000\year. They are right at or maybe 1-2 inches over 50 for this year. So they spent at least $119,000 on the policy so far & may get $15,000-$30,000 this season, assuming they don't get any more accumulation at this late juncture. Sounds like the insurance company is making out well with those taxpayers' dollars. According to the story in the paper they are the only town in NJ with such a policy. Thought it was interesting.

    JD PLOWER PlowSite.com Veteran
    Messages: 751

    BRL from what I've read, that type of policy, while not common is in place around these parts more and more. I have heard that this is common insurance with large retail/commercial properties, airports and universities. I doubt they have as many takers for that insurance considering how poor the snowfall has been around here for the last few years. :eek:
  3. myo

    myo Senior Member
    Messages: 193

    What are the advantages of having a policy like that? Is $17,000-$19000 a reasonable amount or is that expensive?
  4. Got Grass?

    Got Grass? Senior Member
    Messages: 641

    Can Buffalo get a policy? Heck in with the last two winters. It may just be the key to getting this city outta debt... lol
  5. CMerLand

    CMerLand Senior Member
    Messages: 173


    Did you say Woodbridge??? I have an answer to your question then and you aint gonna believe it, but will help you understand how this might have been set up.

    Do you know who the former mayor of Woodbridge is??? Yep, our current governor, Jim McGreedy. Sounds like one of his budget ideas in action.

    Id love to know if he was the person that signed off on that policy.

    Government in action.

  6. BRL

    BRL PlowSite.com - Veteran
    Messages: 1,277

    "What are the advantages of having a policy like that? Is $17,000-$19000 a reasonable amount or is that expensive?"

    IMO There really isn't an advantage for the town to have such a policy, under it's terms. The 17-19 grand sounds reasonable to me, but the terms are not good for the town. They need to receive over 50 inches, which is over double their yearly snow fall average of 24 inches. Then they receive just 15 grand for each inch over the 50. So they really need a really BIG winter to ever come close to receiving money close to what they have spent. I could see paying an insurance against a huge winter, but make the payout worth the effort should the big winter happen. They spent 300 grand to plow the 22" "So called Blizzard of 2003". So if they managed to eek out a few more inches & maybe get $60,000.00, does that matter at this point after spending over $100,000.00 to get that money? According to the article, most of these types of insurance policies are set up with a threshold of 10 -15 inches above the average, but in this case their threshold is 26" above average. Somebody messed up LOL. It also said most of these policies are in New England.

    Says it was a councilman James Carroll that pushed the policy through. I would bet he's one of Governor Pinocchio's hench men too.
  7. digger242j

    digger242j Senior Member
    Messages: 672

    My wife used to work a Logan airport (BOS). She tells me that one year their contracted weather forecaster predicted a severe winter. They took an insurance policy with Lloyds of London that essentially paid for the entire season of snow removal if there was more than 100". To the best of her knowledge they only did it that one year. Lloyds paid.... payup
  8. landman

    landman Senior Member
    from NJ
    Messages: 185


    I believe that they also get a return on the premium if it doesn't snow much in a season. Being as though I am a local to this town I will ask my friend who is a higher up in the dept of public works.
  9. Pelican

    Pelican 2000 Club Member
    Messages: 2,075

    Sounds something like farmers insuring their crops to grow. Insurance is profitable only for the insurance companies. Look at the years of premiums you pay on vehicle insurance, how much do you end up collecting? I had mt old pickup rear ended and totaled a couple years ago, they offered me $1800 for a very good condition '81 F-350 , 68,000 miles with plow, which I could have easily sold for $4500. The other party had the same insurance as I so after 15 years of paying a $600 annual premium, I got $1800 in return, no, they deducted $400 from my award because I insisted on keeping the truck.

    Wonder if any of the politicians involved had an interest in the insurance company?