Insurance Claim Delays Deliver Massive Profit to Industry by Shorting Customers

In representing homeowners with Hurricane Matthew claims I can’t help but to recall this old, yet very relevant, article.  Still a good read and just as true as ever. 

Insurance Claim Delays Deliver Massive Profits to Industry by Shorting Customers

WASHINGTON — Unlike many other businesses, the insurance industry is bound by law to act in good faith with its customers. Because of their protective role in the lives of ordinary citizens, insurers have long operated as semi-public trusts. But since the mid-1990s, a new profit-hungry model, combined with weak regulation, has upended that ancient social contract…. (Read more)

If you would like further reading on the topic I would highly recommend these books:  “From Good Hands to Boxing Gloves: The Dark Side of Insurance.” By David Berardinelli, and “Delay, Deny, Defend“ By Jay Feinman

Claim Payment denied in 43.8% of all closed Hurricane Matthew Claims in Volusia and Flagler Counties.

Insurance companies have denied payment in 43.8% of all closed Hurricane Matthew Claims in Volusia and Flagler Counties. 

 Insurance companies have denied payment in 43.8% of all closed Hurricane Matthew claims in Volusia and Flagler Counties.  This amounts to nearly half of all insurance claims either being denied or estimated by the adjuster (working for the insurance company) below the deductible. 

As of October 28, the Florida Office of Insurance Regulation reports the following statistics for claims in Volusia and Flagler Counties:

Number of Claims         35,868   

Closed Claims (Paid)       8,025    

Closed Claims (Unpaid)   6,244    

Number Claims Open     21,599  

Percent Claims Closed    39.8%

These statistics raise several questions:

Of the 6,244 unpaid claims, how many claims were either wrongfully denied or underpaid so that the claim failed to exceed the deductible? 

Of the 8,025 paid claims, how many claims were underpaid?

The simple answer is, without review of each and every claim by an experienced property insurance attorney, a homeowner will likely never know if their insurance company properly paid or denied payment.

Free Consultation...No Fee if No Recovery

Why you should consult with a Property Insurance Attorney for EVERY Property Insurance Claim.

The insurance adjuster works for the insurance company, not the insured.  During the two weeks since Hurricane Matthew, I have heard countless people naively say “their” adjuster when referring to the insurance company’s adjuster.  This misconception allows the insurance company to - as a routine business practice - underpay claims.  We have all heard the old adage: Get three estimates when hiring a contractor.  If this is wise advice, then why accept the insurance company estimate at face value? 

My experience is that, on average, there is a 20-50% difference between the insurance adjuster estimate versus an independently-hired contractor or estimator.  In short, you should always consult an experienced first party property insurance attorney in the following scenarios:

  • Denial of insurance coverage
  • Reservation of Rights letter
  • Delays in payment of claims
  • Bad faith by the insurance company

However, more often than not, the insurance company routinely relies on “underpayment of claims” in order to boost its bottom line.  An experienced first party property insurance attorney knows how to maximize your claim.  Most importantly, all cases are accepted on a contingency fee basis for the additional payments obtained, meaning there is no fee if we do not recover additional funds from the insurance company. In addition, the insurance company may be liable for attorney’s fees and costs under Florida law.

After Matthew: Dangers Still Lurk

Don't let down your guard when so many other threats remain.

Although Hurricane Matthew has long since passed, the danger it brought to Volusia and Flagler counties remains.

The storm is blamed for four deaths in this area, but only one occurred while Matthew was lashing us with its winds and rain. Three people have been killed during the cleanup process — a reminder that you can’t take safety for granted just because the skies clear.

The first fatality occurred when Susan Mathes, 63, ventured outside her home in DeLand Friday afternoon to feed her animals during a lull in the storm. She was killed by a falling tree. 

That was the only storm-related death until Monday, when three fatalities occurred. First, 89-year-old Marshall Bailey of DeLeon Springs died apparently after touching a live power line that had been downed by a falling tree.

Next, 9-year-old Jose Angel Barrios died from carbon monoxide emanating from a portable power generator in a back room in his family’s house in Daytona Beach. Jose’s parents and 5-year-old brother also inhaled the fumes and were taken to Halifax Health Medical Center, where they survived.

Finally, Steven Barna, 47, a tree-removal worker from Ohio, was killed at Halifax Plantation in Northern Volusia when a large piece of a tree he was cutting up on the ground rolled on top of him and pinned him underneath.

Some of these tragedies have a familiar ring. For instance, when Hurricane Charley hit Volusia and Flagler counties in 2004 it produced two fatalities: A woman in Daytona Beach was electrocuted after stepping on a downed power line and a man died when a tree fell on top of him while he was clearing debris.

The risk of death or injury during and after severe weather can be minimized by observing these rules:

• Never get close to a downed power wire, let alone touch one. Always assume it’s live and give it a wide berth. Also, don’t touch anything making contact with a line.

• Don’t go outside during severe winds, and don’t assume that what appears to be a respite can’t be interrupted by a sudden gust that sends debris flying through the air or fells a tree or branch.

• Don’t run a generator indoors or near an open window. Carbon monoxide is an odorless gas that can prove fatal before you realize it has become a threat (Jose Barrios was sleeping in his bed when he was killed).

• When clearing brush, be aware of nearby trees that may have been weakened by the storm and could fall at any moment, or whose large branches overhang your work area. Beware of overhead power lines; don’t lift tools or equipment into the air and make contact with them.

Remember, you don’t just take safety precautions before and during a storm, such as boarding up windows or deciding to seek more-secure shelter in an interior room. Use caution and common sense in the aftermath as well. Don’t let down your guard when so many other threats remain.

UM: Stacked or Unstacked

So, it is time for new auto insurance.  While choosing your coverage, it is important to remember that Florida does not require Bodily Injury (BI) liability insurance. Florida only requires personal injury protection (PIP) and property damage liability (PDL). This means that any individual that carries the State minimum will be considered uninsured to cover your bodily injury.  Uninsured Motorist (UM) coverage is the help pay your medical bills and to protect your family from financial ruin after an auto accident. 

Stacked Uninsured Motorist Insurance is the best type of UM insurance to protect you and your family. It will pay for your damages if you get in an accident with an at fault driver who does not have any or does not have enough Bodily Injury (BI) Insurance to cover your injuries.

What are the advantages of stacked coverage? You have higher coverage limits after an accident caused by an uninsured or underinsured driver. Without stacking, your UM limits are capped at your liability limits. By stacking, you get more coverage in case of an accident caused by another driver. Stacked insurance increases UM coverage limits. This is done specifically in relation to how many cars are insured.  Under Florida law, drivers have the option to stack UM within one policy or across multiple policies.

•Stacking across policies: assume you have two separate car insurance policies for two cars, and each has $50,000 of UM bodily injury coverage. If you are involved in a car accident with an uninsured driver and you chose to stack your coverage, you can combine the limit to $100,000 (as long as both policies are under your name) to cover any medical or property bills in excess of the $50,000 on one policy.

•Stacking within one policy: on the other hand, if you have multiple cars insured within one policy, you may be able to stack UM bodily injury coverage. An example of this is if you have three cars each with $25,000 limits and you choose to stack this coverage. If you are involved in a car accident with an uninsured/underinsured motorist, you can have a coverage limit of up to $75,000 no matter which car was involved in the crash.

If the time comes to use your Uninsured Motorist (UM) coverage, contact us to help navigate the claim.

Business Interruption Claims

Whether from a fire, water or even burglary your business will feel the loss of income from these interruptions. 

When this happens the request to the insurance provider is simple: Pay me for the sales I would have had.  But this is anything but a simple request for the insurance provider.  You, as the business owner, must now show the sales that you would have had, the projected or estimated amount is a challenge to prove.  With the need to prepare documentation showing this years projected income verses actual income, as well as the past years growth percentages, it can cost you time and income to meet the challenge. 

Once the documentation challenge is met, it should be a simple matter of payment. But this simplicity is deceptive. Business interruption claims can become more difficult and even contentious in circumstances where differences of interpretation emerge about the reliability of projections or the meaning of policy provisions. A successful claim entails maneuvering through the gray areas inherent in business interruption, including financial projections, consumer demand, and policy interpretation, to reach a number that's reasonable, credible, defensible, and well-supported.

A business owner's success depends on understanding the business interruption language in the Policy. Your job is to run your business, let us help you succeed with a fair resolution to your claim. 

Contact us today for an appointment to discuss your claim.

Does Homeowners Insurance Cover Lightning Strikes?

With the 2016 hurricane season getting started, it is a good idea to review your homeowner’s policy for coverage exclusions.  Your insurance agent probably let you know whether you live in a flood zone and whether additional flood insurance was mandatory and highly advised.  But, what about lightning?

Typically lightning strikes, as well as fire caused by lightning, are covered as perils in almost all homeowner’s insurance policies.  But, there may be exclusions.  Read the fine print.  For example, your policy may not cover damage from an electrical surge that occurs when lightning strikes the power line that runs to your home.

A lightning strike can create a fire inside or outside your home, ruin sensitive appliances, electronics and wiring inside the walls, and even shock and injure occupants.

If a lightning strike happens, the most important thing is to safeguard your family and yourself. 

•Make sure your house is equipped with smoke and fire detectors. Lightning is so hot that fires caused by direct strikes are instantaneous. If you smell smoke or feel heat during a storm, evacuate the building immediately.

•Make sure all of your appliances are plugged into grounded outlets that offer surge protection. This will not protect against a direct strike, but it may help if there is an electrical surge in a storm. For maximum safety, unplug computers, televisions, microwaves and other electric appliances during storms.

•If you live in a high strike area, consult professionals about installing lightning rods or whole house surge protection.

Contact us if you need to file a claim for damages incurred by a lightning strike.

Insurance Companies Search Social Media

Policyholders are human and social media has really become a way of life.

One of the first things people do after an auto accident is to post photos on social media.  But consider this: insurance companies are using information gathered from your social media to look for information they can turn into a red flag or a reason to delay or deny your claim.

Even if you don’t post one thing about your loss, you may still be under fire by your insurance adjuster about posts placed on the Internet regarding your social activities.

When insurance companies are questioning insureds in a recorded statement, during an initial claim intake or interview, or at examinations under oath, they have already done a detailed evaluation into your public profiles.

To really grasp the power and the magnitude of how posting rants and photos can affect your insurance claim, you would really need to think about what an insurance company would be looking at on your social media accounts that have nothing to do with your current claim. Here is the short, non-inclusive list

  • Posts about purchase or inheritance of items
  • Posts about marital trouble
  • Posts about financial trouble
  • Your vacation photos
  • Posts about spending money on things perceived to be an extra or an unnecessary item
  • “Check in’s” at various locations, shows your whereabouts, habits and gives some insight into your spending.
  • Posts about arguments with the family

You never know when you are going to suffer an accident or sudden property loss, but keep your eyes open and understand what “research” is happening on the mobile device of the adjuster before they speak to you.

Don’t delay. Contact us today if you have had an accident or property loss.  Please, don’t give a recorded statement until you know your rights.