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    Hurricane Sandy unlikely to torment Mass. insurers

    Did Hurricane Sandy turn the business of insuring ­homeowners across Massachusetts into a losing proposition this year?

    Like everyone else covered by home policies, I lost no sleep worrying about the financial threat this week’s storm posed for my insurance company. But expensive events like Sandy can eventually ­influence what I pay for coverage and who will write the policy.

    It’s too soon to draw firm conclusions about Massachusetts homeowner insurance claims in the wake of Sandy, but the early evidence is encouraging. The volume and nature of early claims suggest total insurance expenses will be less than for tropical storm Irene last year, according to the state’s insurance commissioner, Joe Murphy.


    Executives who manage the pooled FAIR Plan coverage , which writes more than 13 percent of all Massachusetts homeowner insurance and nearly 47 percent of policies on Cape Cod and the islands, told me Thursday that they had received just under 1,100 ­Sandy-related claims. That number will surely rise, but it’s less than half the 2,300 FAIR Plan claims eventually generated by Irene last year.

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    Of course, all of that is good news for everyone because it means we suffered less damage than feared just a few days ago. There have been many types of homeowners insurance claims in Massachusetts but most of them involve trees falling on roofs or cars or garages — real problems but few catastrophes.

    Its also good news for insurers. Now it seems likely they should come close to breaking even on homeowner coverage in Massachusetts this year, based on my back-of-the-envelope math — as long as we don’t get hit with another big storm before New Year’s Day.

    Murphy declined to endorse my rough calculation but said: “At this point, I don’t think we have any concerns for the health of our companies writing policies here.”

    That doesn’t mean all the numbers are pretty. State regulators just filed an annual report on the Massachusetts homeowner market showing insurers almost certainly lost big money in 2011, a rarity over the past decade.


    “The facts of this report reflect that they took a beating,” Murphy said.

    The home insurance business in Massachusetts is consistent from year to year in all aspects but one: extreme weather and the damage it can cause.

    Weather was a expensive problem last year. Besides Irene, tornadoes and other severe weather struck Central and Western Massachusetts that June. Insurers processed thousands of related claims and paid out more than $169 million.

    The total number of homeowner claims in Massachusetts nearly tripled to 226,022 last year. The average claim sought $6,784 for damages.

    The state’s annual report on homeowners insurance doesn’t track how much money insurers made or lost. But it adds up all insurers’ combined costs — including claims settlements, overhead, and commissions — and compares them to premium revenues.


    Last year, those all-in expenses amounted to more than 134 percent of premium revenue. Other insurance business factors, including investment income, surely didn’t come close to covering a revenue gap that big.

    But 2011 was an exception for Massachusetts home insurers. Over the previous seven years, the insurance industry’s total expenses for homeowners coverage amounted to about 83 percent of annual revenues, on average. Expenses only came close to equaling revenues — at 97.1 percent — in 2004, the first year regulators tracked the figures.

    Numbers tracking the home insurance market in Massachusetts only tell you what was happening a year into the past. They are hardly a reliable tool to forecast what is going to happen to customers and the cost of coverage in the future.

    But the details about the insurance market of 2011 suggest carriers won’t get clobbered this year as a result of a big storm that could have been so much worse in Massachusetts.

    The Red Herring

    Denterlein, the Boston communications company, has completed its acquisition of Morrissey & Co., a local public relations firm specializing in reputation management. The firms’ presidents, Geri Denterlein and Peter Morrissey, had signed a memorandum of ­understanding establishing terms of the transaction before Morrissey died in August. The combined firm will represent clients such as Boston Children’s Hospital, Safety Insurance, and the Mandarin Oriental Boston ­hotel.

    Steven Syre is a Globe columnist. He can be reached at