Problem: The insurance companies that failed to meet the expectations of the victims of Hurricane Katrina might undergo significant damage control efforts. According to Leslie Eaton and Joseph B. Truester (2007) "victims suffered many losses that were not covered" under the insurance plans. "Insurance companies that reneged on their promises, offered only pennies on the dollar in settlements, dribbled out payments, low-balled the costs of repairs, dropped long-time customers and sharply increased the price of coverage." (Eaton et al, 2007).
In an ongoing process to rectify some of the damage that was caused from Hurricane Katrina, insurance companies' lack of assistance may tarnish their reputation which could result in loss of business and corporate shut downs. In essence, after all of the lawsuits subside, the insurance companies profit margin could ultimately suffer thus leading the organization to file for Bankruptcy.