Tag Archives: Citizens sinkhole claims

Citizens Offers to Settle Another 600 Sinkhole Cases with Marshall Thomas Burnett

Florida Homeowners Insurance Claims and Litigation Handbook

Overview:

Citizens made an offer to 600 of Marshall Thomas Burnett’s clients to resolve pending sinkhole lawsuits.  This follows the 300 offers to Thompson Trial Group’s clients, and the 300 with Boyette, Cummins & Nailos.



In the press release included below, you can see the process of how the proposed settlement will play out for the homeowners; however, the terms of the proposed settlement for attorney’s fees were not included in the release:

Download (PDF, 79KB)

In this article regarding the first of these group settlements, I outlined my analysis on why these settlements make perfect sense for everyone, especially Citizens.  By taking a top-down approach to these claims, Citizens was able to substantially reduce exposure while still giving the homeowners everything they needed.

The only question is “how to we get to these results one month after the lawsuit is filed, instead of after years of litigation?” As you know, my opinion is that software could have yielded the same results at a fraction of the costs.

In the press release, Citizens also stated it has approximately 2,000 sinkhole cases remaining.  As always, we will keep you updated.

Takeaway:

The billion dollar sinkhole claim industry keeps inching towards extinction.


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Florida’s Citizens Property Insurance Agrees with Thompson Trial Group to Settle 300 Sinkhole Cases

Citizens Property Insurance Corporation

Sinkhole cases are that much closer to being done in Florida. Read this article to get the details on Citizens’s recent settlement with Thompson Trial Group.


According to a press release today, Florida’s Citizens Property Insurance Corporation reached an agreement to resolve 300 litigated sinkhole homeowners insurance cases with Thompson Trial Group.  The press release contains the relevant information, including the terms of the coverage and repairs, as well as the agreed payments to Thompson Trial Group:

Download (PDF, 81KB)

This follows a March, 2014 settlement of another 300 sinkhole cases I discussed here.

Florida is now one step closer to closing the door on the billions of dollars in losses for sinkhole claims over the past decade (or more); however, hundreds, and maybe thousands, of sinkhole claims remain pending in litigation. As always, I will update you when the next mass settlement occurs.


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A Rare Win Win in Property Insurance as Citizens Settles Portion of Confirmed Sinkhole Claims

Citizens Property Insurance Corporation

What happens when Florida’s Citizens Property Insurance Corporation and a group of Plaintiffs’/Policyholders’ attorneys decide that the litigation just doesn’t make business sense anymore? Read this first of a series on Citizens’s multimillion dollar settlements with plaintiffs’ attorneys to resolve hundreds of sinkhole cases.


Quick Update:

After this article was posted, Citizens settled an additional 300 cases with Thompson Trial Group and 600 cases with Marshall Thomas Burnett.  Make sure to read those articles after you finish this one.

Correction: The Tampa Bay Times is reporting that Citizens may have reported the settlement without having confirmed that the policyholders agreed to it.  For more information on this and other issues relating to Citizens’s legal defenses, see this March 18, 2013 article.

Nevertheless, because it appears the policyholders’ attorneys in this settlement agree this is a good outcome for their clients, there is a good chance that many of these cases will get resolved.  If new information arises, I will update this article.

On March 12, 2014, Citizens announced it will settle 300 policyholders’ confirmed sinkhole claims.  The terms of the settlement include:

  • Citizens agrees to pay for the repairs and stand by the repairs
  • Citizens agrees to allow policyholders to choose their contractors from a pre-approved list
  • Citizens will pay the policyholders’ law firms $2M – $5,000.00 per nonlitigated cases, $10,000.00 per litigated cases

Here is the press release:

Download (PDF, 66KB)

Citizens’ press release applauded coordinating counsel for the settlement.  In the press release, Citizens states that this settlement will save it $30M in legal fees.

contract 4

In my opinion, this appears to be a win-win for both parties.  No one can be sure without reviewing the terms of the releases; however, what is clear is that (1) the policyholders will obtain repaired homes and (2) Citizens will be spending its money repairing homes, instead of litigating these issues.  That means the parties achieved what they set out to do.

Although you might argue that this result could have happened sooner, both sides had significant victories over the past year or so, and this allowed each side to modify their position towards the middle.  This settlement shows that both sides had a mutual respect for each other and put Florida’s and the policyholders’ interests ahead of their own. Congratulations to all involved.

This is also a win for litigation project management. Innovative services like THIS are the only way to effectively handle property insurance litigation.  These cases were not that complicated when you approach them categorically.  For insurers with more than 5-10 law firms handling their cases, panel counsel need a coordinating counsel or a software tool that performs the same tasks and oversight. Panel counsel simply do not have the tools or the incentives to make these types of decisions.

Applying litigation project management principles, coordinating counsel and/or equivalent software needs to direct panel counsel by (1) identifying the insurers’ goals with the client, (2) breaking down each stage of litigation, and (3) determining how to optimize the process at each stage (and not waste money).

Coordinating counsel must also identify and automate the routine tasks, and insurers can purchase customized software for litigating property insurance claims in Florida to automate the routine tasks. Otherwise, all the time and money goes towards attorneys and adjuster laboring over routine tasks all day, and there is no time for critical thinking.

As you can see from the Citizens example, when insurers set up the structure to make intelligent results happen, intelligent results happen. Companies that make these tough, innovative decisions will be rewarded.  Companies that punt these tasks to their attorneys without a top-down strategy will waste millions of dollar and hours to achieve less favorable results.

Takeaway:

Citizens did a phenomenal job of embracing litigation project management.  If they would have added the key component of software to the mix, they could have really gained power and control over these cases from the lawyers.  If you want checklists and guides to help you reach results even better than this without spending a fraction of what Citizens spent, please message me.


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