Claims adjusters struggle to work amid Gulf storm's devastation.

Claims adjusters struggling to do their jobs in areas devastated by Hurricane Katrina have faced monumental hurdles--a lack of lodging, a shortage of gasoline, inaccessible areas and policyholders who have been evacuated or left the area.

"We're faced with logistical issues I'm not sure how we're going to address," Bob Warner, claims manager for Louisiana Farm Bureau Insurance Co., said during a conference call hosted by the Property Casualty Insurers Association of America.

Katrina came ashore near New Orleans Aug. 29 as a Category 4 hurricane on the Saffir-Simpson scale with winds of 145 mph. While the hurricane didn't directly hit New Orleans, storm surges from Katrina weakened and breached the levee system protecting New Orleans, which is below sea level. The flooding has surpassed the previous U.S. record flood on the lower Mississippi in 1927.

Catastrophe modelers estimated insured losses from Katrina to be as much as $60 billion as of Sept. 15.

"This is worse than Andrew," said Hart Hubbard, assistant vice president of catastrophe services for GAB Robins, an independent adjuster firm. Hurricane Andrew in 1992 was the United States' costliest hurricane on record with about $21 billion in insured losses, when adjusted for inflation.

Warner said catastrophe adjusters are "stretched thin" by "the sheer number of claims," much like during last year's four hurricanes.

With many people out of the area, Warner said adjusters faced some difficulty in getting living-expenses checks to policyholders, but his company has now "delivered checks all over the state" and in many parts of the country where storm victims have fled. And Louisiana Farm Bureau, which expects 15,000 to 20,000 claims from the storm, is not letting absent policyholders stop it from adjusting losses.

Another hurdle adjusters have faced is the lack of electricity. Warner said many of Louisiana Farm Bureau's offices were damaged and without power.

"We've gone back to the old days when we did loss reports on paper," Warner said.

But conditions have improved slowly, industry watchers said. Slowly also applies to the claims process because of the problems adjusters have faced.

"It's going to be a long, drawn-out process, and it's going to be a while before anyone can get into New Orleans," Hubbard said.

Because the hardest-hit areas have been off limits, the traditional response of heading to the most affected areas first has been flipped on its head. Instead, Hubbard said, adjusters work their way toward the most affected areas as they respond to areas they can access.

"The losses we're working on now, the majority are wind," Warner said. He said it would become more difficult when adjusters have to discern flood from wind damage as they reach harder-hit areas. But a visual inspection can give clues such as water lines in a home hit by flood waters or water damage limited to one portion of a home hit by wind-driven rain.

Even the areas that can be accessed in Louisiana, Mississippi and Alabama have serious infrastructure problems. Street signs are gone in some areas, landmarks obliterated, mailboxes are blown away and houses are unrecognizable if they still even stand.

"You may have an address, but you can't find the exact location," Hubbard said. "A lot of homes were demolished."

"The biggest challenge is gasoline," said Tiffany O'Shea, a spokeswoman for the American Insurance Association. "There's a real shortage."

While many insurers have sent in mobile claims centers--RVs and vans with self-contained generators and electricity--Hubbard said even these face the pinch of the gas shortage and rationing in some areas. Jennifer Wislocki, a spokeswoman for St. Paul Travelers Cos., which has about 550 adjusters and five mobile centers in the area, said at least one mobile claims center RV ran out of gas.