Tag Archives: Property Insurance

Citizens Approves Another Round of Florida Homeowners Insurance Takeouts

Citizens Home Insurance Florida

Overview:

The Citizens takeouts continue. Insurers were recently authorized to assume nearly 100,000 policies from Citizens. Read more to find out the companies involved in this round of takeouts, and how successful the recent takeouts have been.

Update on Citizens Takeouts

Florida regulators approved Florida insurers to assume approximately 93,500 policies from Citizens. The companies and their allotment include:

  • Mount Beacon: 35,000
  • Anchor Property & Casualty: 28,000
  • Heritage: 20,500
  • Southern Oak: 10,000

The Tampa Tribune gave us some interesting statistics on how many of these recent takeout approvals actually converted to takeouts. In 2014, although approximately 1.1M policies were approved for assumption, insurers only assumed approximately 415,000.

In the last two years, Citizens has seen its policy count decrease from approximately 1.5M to 661,000. As a result, Citizens’s exposure has decreased from $510B to $200B.

If you want to know more about the takeouts over the past several months, here are our articles:

If you want to learn more about some of the other insurers involved in the recent takeouts (Mount Beacon, Anchor, Homeowners Choice, and more), make sure to click on the links in the bullets above, or you can view all of our Takeout articles on one page here.

If you have any questions about this article or anything else, please contact me.

Florida Citizens Takeout Update: Homeowners Choice Insurance Authorized to Assume 50,000 Citizens Policies

Citizens Property Insurance Corporation

Homeowners Choice has been authorized to assume approximately 50,000 Citizens policies. 27,000 of these policies are wind-only coverage.

For those of you keeping track, here are the details on the takeouts occurring over the last few months:

If you want to learn more about some of the other insurers involved in the recent takeouts, make sure to click on the links in the bullets above, or you can view all of these articles on one page here.


Have Any Questions about Florida Homeowners Insurance Claims?

If you have any questions about this article or Florida homeowners insurance claims and litigation, please contact us.

Florida Approves Takeout of More Than 180,000 Insurance Policies from Citizens

Citizens Property Insurance Corporation

Citizens Takeouts

Florida recently approved more than 180,000 takeouts of personal and commercial property insurance policies from Citizens. This follows September’s takeout opportunity of approximately 425,000 policies discussed in this article, and an earlier October takeout of over 200,000 policies discussed here.

In the most recent takeout, Florida regulators approved the following takeouts:

Anchor Property & Casualty Insurance Company Insurance Company – 50,000 personal residential policies

• Avatar Property & Casualty Insurance Company – 10,000 personal residential policies

Cypress Property & Casualty Insurance Company – 23,000 personal residential policies

Heritage Property & Casualty Insurance Company – 20,000 personal residential policies and up to 500 commercial residential polices

Mount Beacon Insurance Company – 38,485 personal residential policies

Prepared Insurance Company – 20,000 personal residential policies

Security First Insurance Company – 8,555 personal residential policies

Southern Oak Insurance Company –  10,000 personal residential policies

United Property & Casualty Insurance Company – 2,027 commercial residential policies

Have any more questions about this article or other Florida homeowners insurance claims issues? Please contact us.

 

 

Florida Approves Takeout of More Than 210,00 Insurance Policies from Citizens

Citizens Property Insurance Corporation

Late last week, Florida approved more than 210,000 takeouts of personal and commercial property insurance policies from Citizens.  This follows September’s takeout opportunity of approximately 425,000 policies discussed in this article.

In this October takeout, Florida regulators approved the following takeouts:

American Colonial Insurance Company – 22,050 personal residential policies

Cypress Property & Casualty Insurance Company – 23,000 personal residential policies

Heritage Property & Casualty Insurance Company – 20,000 personal residential policies and up to 600 commercial residential polices

Homeowners Choice Property & Casualty Insurance Company – 69,000 personal residential policies

Mount Beacon Insurance Company – 29,515 personal residential policies

Olympus Insurance Company – 10,000 personal residential policies

Safepoint Insurance Company – 18,000 personal residential policies

United Property & Casualty Insurance Company – 2,027 commercial residential policies

Weston Insurance Company – 19,515 personal residential policies and up to 1,781 commercial residential and non-residential policies




Have Any More Questions about Florida Homeowners Insurance Claims?

P

Please contact us.


photo from: https://www.citizensfla.com/about/newsroom.cfm

Florida Homeowners Insurance Claim for Long Term Water Leak Not Excluded as a Matter of Law

Florida Homeowners Insurance Claims and Litigation Handbook

Overview:

In Price v. Castle Key Indemnity Company, Florida’s Second DCA recently dealt a heavy hit to homeowners insurers’ arguments using the continuous/constant or repeated seepage defense.

Drop of water

 

Facts

The facts in Price were a prime example of a long term water damage insurance claim. The homeowners insurer gathered strong evidence, and was able to show that this leak continued for weeks and weeks without any stoppage. The insurer’s evidence was startling: over a period of more than 30 days, over 195,000 gallons of water escaped from a pipe going to the homeowner’s toilet.  Faced with this evidence, the trial court granted summary judgment for the insurer.

The Second DCA disagreed with the insurer and the trial court. The Second DCA’s reason: the terms “sudden” and “seepage” were “less than clear” when applied to these facts. Accordingly, the Second DCA determined that these words created a latent ambiguity.  The Second DCA instructed the trial court to allow a jury to determine coverage in this case, instead of a judge.

Disappointing Discussion

Although this is the most heavily litigated coverage issue in Florida homeowners insurance, the Second DCA did not take much time to explain its decision.

These long term water damage opinions don’t come often. Usually, claims do not have such egregiously long leaks, or they have some type of dispute on the duration … so they should be determined by a jury. When the rare case like this pops up, you would think the Second DCA would take the chance to explain what types of long term water damage should be covered as a matter of law under these policies; and what types shouldn’t be.

Unfortunately, the Second DCA did not take that opportunity. Moving forward, this leaves many unanswered questions, and a lot of room for interpretation for trial court judges. I wouldn’t be surprised if there were tens of thousands of pending claims with this issue. The parties and lawyers handling those cases don’t seem to have much to work with from that case, unless they are to assume every insurance policy is ambiguous.

Takeaway

In trial court hearings, this Price opinion will give homeowners’ attorneys stronger arguments, but only if the homeowners insurer tries to obtain summary judgment.  Most of these cases don’t go that route.

I would not be surprised to see other DCAs take a different approach than the Second DCA did in Price.  I doubt all courts will be willing to find that every insurance policy is ambiguous as to long term water losses. A case like this is the perfect example of a case where insurers could be granted summary judgment.

We will see how this changes the strategies. Hopefully, we will get some more opinions on this issue soon.


Have Any More Questions about Florida Homeowners Insurance Claims?

Please contact us.


Florida Homeowners Insurance Claims and Litigation Handbook

Florida Homeowners Insurance Claims and Litigation Handbook

Florida Homeowners Insurance Claims and Litigation Handbook and Litigation Data Reports:

Before we go on, if you are in the Florida homeowners insurance claims industry and are looking for a guide with the key cases, strategies, laws, attorneys, and adjusters, or if you’re looking for Florida litigation data reports, please visit this page to learn more about our Florida Homeowners Insurance Claims and Litigation Handbook.


Here is a full copy of the order:

Download (PDF, 51KB)

 

Florida Regulators Approve Takeout of 425,000 Citizens Policies

Citizens Property Insurance Corporation


Citizens Property Insurance Corporation Logo

Yesterday, Florida insurance regulators announced that several Florida homeowners insurance companies will have the option to takeout a total of 425,000 policies. According to the Tampa Bay Times, the two biggest approvals went to Heritage Property & Casualty Ins. Co. (approximately 70,000) and Elements Property Insurance Co. (approximately 60,000.00).

These 425,000 policies comprise nearly half of the estimated 933,000 outstanding Citizens policies.

In addition to Heritage and Elements, regulators also authorized the following companies to assume policies from Citizens:

  • American Integrity Insurance Co.
  • Avatar Property & Casualty Insurance Co.
  • Capitol Preferred Insurance Co.
  • Mount Beacon Insurance Co.;
  • Olympus Insurance Co.
  • Safepoint Insurance Co.
  • Southern Fidelity Insurance Co.
  • Southern Fidelity Property & Casualty Insurance Co.
  • Southern Oak Insurance Co.
  • Tower Hill Signature Insurance Co.
  • United Property & Casualty Insurance Co.
  • Universal Insurance Co. of North America

This will shake up First Party Property Insurance Blog’s Florida Homeowners Insurers Lists. Take a look at that page if you want to know where the policy counts stood earlier this year.

If you have any questions about this article or anything else, please contact us.

Florida Homeowners Insurance Claims for Hail Damage to the Roof

Florida Homeowners Insurance Claims and Litigation Handbook

Overview:

This article about hail damage and insurance claims is the most popular article on First Party Property Insurance Blog for a reason…

What happens when a homeowner has a roof leak?  Was the leak from the eventual wear and tear on the roof?  Or did hail cause the damage to the roof and the roof leak?  Is it covered by insurance, or it is not? How do I find out if it was hail?  What if my roofer is saying hail caused it, but I am not sure? These are some of the toughest questions facing homeowners and homeowners insurers today.

You have heard it in the news whether you are in the insurance industry or not: hail claims are increasing in rapid numbers.  Hail claims raise many insurance issues.  What do you need to know about them?


Understanding the Issue: Could the Actual Roof Be Covered by Homeowners’ Insurance?

Here is the issue: when an aged roof leaks, people understand that the Florida homeowners insurers will not pay to replace the roof. Most people know that the Florida homeowners insurers specifically exclude wear and tear from coverage, and the only time a homeowners insurer will pay for a new roof is if there was a hurricane or some other event. So, when a roof fails, people report a claim for the damage that was caused by the actual water leaking through the roof, but not the roof itself.

Now, however, people are reporting more hail claims than ever, and homeowners insurers are seeing some suspicious hail claims.

Why is this an issue?  Because if someone reports a roof leak as a hail claim instead of from wear and tear, the homeowner may be entitled to insurance coverage for the roof repairs (in addition to the damage from the water leak).

Thus, now you see where the suspicion comes in: when a homeowners insurer responds to dozens to hundreds of homeowners insurance claims where the adjuster cannot find hail damage on the roof … but the homeowners’ roofer is 100% certain that there is hail damage.

So, have homeowners insurers taken the suspicion too far?

Have the homeowners insurers’ attorneys taken the suspicion too far?

That’s what Chip Merlin says.  In that article, he explains his objections to this hail article in Claims Journal from Steve Badger, an attorney who represents homeowners insurance companies.


Florida Homeowners Insurance Claims and Litigation Handbook

Florida Homeowners Insurance Claims and Litigation Handbook

Florida Homeowners Insurance Claims and Litigation Handbook and Litigation Data Reports:

Before we go on, if you are in the Florida homeowners insurance claims industry and are looking for a guide with the key cases, strategies, laws, attorneys, and adjusters, or if you’re looking for Florida litigation data reports, please visit this page to learn more about our Florida Homeowners Insurance Claims and Litigation Handbook.


I am not going to say who is right and who is wrong, but I will take the chance to quickly point out some of homeowners insurers’ biggest mistakes when handling an insurance claim for hail damage, and how to fix them.

The Mistakes in Handling a Hail Claim

In my experience, the worst thing an insurer can do is simply hand a hail damage property insurance claim to an adjuster or attorney and ask them to have an engineer or roofer provide a cause and origin opinion. First, its expensive.  Second, it will become even more expensive if the insurer relies solely on the expert without considering whether there is evidence of a hailstorm in that area.

Easy Ways to Avoid Costly Mistakes

Even if you don’t have your own database to evaluate similar claims in the area, similar claims from that roofer, or similar claims from that attorney, there are plenty of databases that reflect evidence of a hail storm, including online search tools (Hailstrike and StormIntel for example) and public records requests to see if anyone else in the neighborhood replaced their roof.

If there is evidence of hail reports in the area, it will be difficult and costly to defend against coverage, and the insurer should use the available technology to limit its loss adjustment expenses moving forward.  If there were not any hail reports, then a cause and origin expert and attorney might be necessary to solidify a defense (wear and tear, marring, and oftentimes late notice).

As the author of the Claims Journal article noted, the only ways to actually stop suspicious claims would be to amend policies and statutes. Otherwise, insurers’ most likely method of defending this cases requires a costly jury trial on the factual issue of causation.

Takeaway:

Remove the emotion and judgment from these cases and just focus on the facts.  How do you focus on the facts?  First, figure out what those facts are.

Next, once you have decided what you need to know about a claim to make a coverage decision, make a checklist, provide some guidelines, use software, or do anything.  Just don’t leave these determinations up to a subjective decision without any structured evaluation prepared by your top management and top attorneys.

Software can make this issue much simpler.  If you want to know more about how software is doing remarkable things to control hail claim litigation, please message me.




Did this Article Answer Your Homeowners Insurance Question?

If not, please contact us.

Florida Appellate Court on Rodrigo v. State Farm and Insurance Policy Conditions Precedent After Curran

Florida Homeowners Insurance Claims and Litigation Handbook

A Florida appellate court recently made some important decisions for anyone interested in Florida homeowners insurance.  Do you need to know about the legal impact of issues with Examinations Under Oath, Proofs of Loss, and the Other Policy Conditions.  Then you must read this article.


The Fourth District Court Appeals recently issued the first decision on conditions precedent in insurance policies since the Curran case.

Download (PDF, 132KB)

Things are too busy at Todd Legal, P.A. to do the usual “deep dive” into the ruling and the impact, but I wanted to make sure everyone was aware of the decision.  As you know, we at Todd Legal provide software and other innovative services to Florida’s property insurers and their attorneys to deliver legal services that are smarter, cheaper, and quicker than what insurers have come to expect.  We are nearing the delivery stage, so I am not going to be able to timely analyze this Rodrigo decision in enough detail to assess its overall impact.

In summary, the Fourth DCA held that the proof of loss provision is still a condition precedent after Curran.  I encourage you to read the full opinion and focus on how the requirement was laid out in this policy, including the loss settlement provision.  Once again, we will await the next decision to see how courts may eventually interpret the EUO provision after Curran, but this decision certainly helps insurers and their attorneys when they try to explain to the judges that Curran may only apply to auto accident/UM cases.  I apologize for the brief analysis and will try to supplement this article in the near future.

home 3


Did this Article Answer Your Homeowners Insurance Question?

If not, please contact us.

New Florida Federal Court Decides Franqui re Florida Sinkhole Structural Damage Definition and Sinkhole Testing Requirements

Florida Homeowners Insurance Claims and Litigation Handbook

Are you up to date with the latest Florida Court rulings on homeowners insurance, sinkhole claims, and sinkhole activity?  If you aren’t sure, then make sure to check out this article!


Federal Judge James Whittemore recently joined Judges Radabaugh, Merryday and Lazzara in finding that “structural damage” caused by sinkhole activity must mean more than “damage to the structure caused by sinkhole activity”  This litigation involved an insurance policy that did not incorporate the Senate Bill 408 “structural damage” definition; therefore, the parties disputed whether coverage for sinkhole activity required more than just cracks caused by sinkhole activity.

home 2

More specifically, the Court answered the following questions:

  • Does “structural damage” mean “damage to the structure” or does it mean something more, such as:
  • (1) the five part definition in Fla. Stat. 627.706 (2011);
  • (2) damage to the load bearing portions of the property; or
  • (3) damage that could cause the house to collapse?
  • Does an insurer with a pre-408 policy breach the policy when it does not conduct a full subsidence investigation in accordance with the pre-408 version of Fla. Stat. 627.707?

Structural Damage: The Court ruled “structural damage” in this insurance policy means “damage to the structural components of the building, excluding damage that is cosmetic in nature.”

Testing Requirements: Judge Whittemore also determined that Liberty Mutual did not breach the policy when it did not conduct a “full” subsidence investigation to eliminate sinkhole activity as a cause of the damage.

Analysis:

Here is the complete order:

Download (PDF, 829KB)

Again, we see trial courts construing the words “structural damage” to mean more than what we are used to seeing.  As you know, 20+ courts have determined “structural damage” simply meant “damage to the structure.”  This “lowered” standard resulted in any cracks triggering coverage for “sinkhole loss.”  With the newer interpretations, though, courts are now asking the homeowners’ expert to show that the sinkhole activity is causing substantial damage to important parts of the property.

As you know, this issue only remains relevant to those claims and cases arising under policies without a definition of “structural damage.”  Since late 2012, many of the insurers added a definition and removed all doubt on this issue.  Nevertheless, thousands of cases remain with these pre-408 policies, so these rulings could continue to build substantial momentum for insurers.

Conclusion:

I think the most amazing thing about this line of decisions is that this issue is still relevant in 2014.  Why is the “structural damage” issue still relevant?  If insurers had innovative services in 2006 using the same arguments they had now, they would be done paying the millions it continues to cost to litigate these issues, and the “structural damage” issue would have been irrelevant (one way or the other) 8 years ago.


Did this Article Answer Your Homeowners Insurance Question?

If not, please contact us.

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.


Did this Article Answer Your Homeowners Insurance Question?

If not, please contact us.

« Older Entries