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By Kate Cimini
The first incident occurred in the master bedroom.
As Hurricane Ian pounded Southwest Florida with heavy rain and winds of 145 mph, Sara Alvarez ripped the roof from her home.
As the rain fell, it soaked everything, including walls and floors. Jackson used a Shop-Vac on the ceiling to try and remove water, but by the end of the storm the ground floor in the townhouse was covered with 2 inches.
Alvarez developed headaches all day and symptoms similar to the flu as mold started growing in the channels water had made in his walls.
It was only the beginning.
After a contractor ripped out the walls in Phase VI Parkwoods of south Fort Myers and other townhouses that were affected, the insurance company for the homeowners’ association refused to pay the $2 million needed for emergency repairs. This left hundreds of homes half-destroyed.
Records from the state show that Floridians were not the only ones who suffered because of Heritage Casualty & Property Insurance.
Many Floridians have not recovered from last season’s hurricanes, even though the new hurricane season has already begun. Their carriers are allegedly delaying payments, underpaying customers or refusing to pay. They claim that the state is not doing enough for consumers, and it’s too lenient on insurance companies and criminal insurers.
More than 4,000 residents filed complaints to the state in the aftermath of Hurricane Ian against their carrier.
Residents have complained about their coverage being extended 17 times in the last year. They have also received extra payments or had their claims reopened. As insurers depart the state, rates rise and houses are in poor repair, consumer attorneys receive more support.
Michael McQuagge of Fort Myers, an attorney for consumers said: “Since Ian everyone has had a dilemma where they either aren’t getting enough benefits or won’t cover their costs.”
Not just one insurer is affected – all are.
SouthernCAT arrived immediately after Ian, who was tracking north, left Lee County. They tore out the drywall on all of Parkwood’s townhomes. They hung massive fans in order to dry mold. Then, they welded gray tarps onto the roof. Following a warning to the residents, the workers told them that the tarps could only be used for about a month.
Heritage did not pay SouthernCAT for its work until July the next year, even though it was past Florida law’s 90-day limit for legitimate insurance claims.
Lee County records indicate that SouthernCAT stopped work on the townhomes due to non-payment for months. SouthernCAT didn’t respond to several requests for comment.
Heritage also underestimated the cost to restore the townhouses damaged by fire or other causes back to the original condition. When the association of homeowners filed a claim with the state it only offered $1.4million out of two claims that totaled $12 million.
Joe Powers was contacted by reporters and said, “I didn’t even know that the Parkwoods case existed.” He added it is now his biggest concern. Heritage will make sure they pay the emergency claim. He was told that Heritage would revisit the claim of $10 million.
The thousands of Florida home owners whose insurance companies have not yet acted are left with little hope.
There are a lot of complaints
Florida’s insurance market has suffered a steady decline in the last few years. The state is experiencing an increase in premiums for insurance, as insurers go bankrupt or stop writing policies. In addition, the storms of Florida are becoming wetter, more intense, and stronger due to climate change. An insurance denial or lowball claim offer can ruin a homeowner, because the inflation rate makes rebuilding after damage more costly.
Consumers rarely file lawsuits against carriers or lodge complaints with the state. There are new obstacles to filing lawsuits, and there’s no guarantee of success.
McQuagge’s claims were confirmed by the records of consumer complaints filed since January against property insurers.
Jimmy Patronis has received more than 12,000 complaints since January against Florida carriers, of which 4,173 are attributed to Hurricane Ian. These complaints are primarily about a claim that was delayed, an underpayment or a non-responsive carrier.
The counties of Lee, Collier, Charlotte, where the storm was the worst, have 60% complaints regarding too low or too slow payments.
According to the records, Citizens Property Insurance Corporation has received several complaints. American Integrity Insurance Company of Florida, however, collected most of them regarding claims delays. American Traditions Insurance Company, on the other hand, had the highest number of complaints about payment underpayments.
Devin Galetta is Patronis’ director of communications. She said that more complaints may be filed as carriers implement policies to cover areas affected.
Heritage Insurance, who insures Parkwoods VI has received 683 customer complaints since October 20, 2022. The majority of complaints are a result of Hurricane Ian.
I requested to be interviewed by the Office of Insurance Regulation. This office investigates fraud committed by insurance companies on the marketplace. Samantha Becquer, in an email to me, said at least 50 possible cases of fraud by insurers were being investigated. She declined, however, to confirm if any insurance companies had been penalized, referred to criminal charges or found guilty.
Patronis receives complaints from insurance companies that the carriers are delaying payments. This, he says, is due to a mixture of ignorance, fear and impatience.
Patronis stated, “People have to deal with a catastrophe.” The investment they made in their lives has been destroyed. So, things can’t move fast enough.
The office of the commissioner can look into specific complaints filed by unhappy policyholders.
Patronis said: “We are best for recovery.”
Some homeowners have found out that filing complaints with the State, such as the Parkwoods Phase VI Association did, didn’t work as well as they hoped.
Kostas lazarides was literally lifted off his pilings by the storm surge on Sanibel Island. Since October 20, 2022, he hasn’t been contacted by his agency.
Fort Myers resident whose roof, kitchen and other property were damaged in the storm has filed a formal complaint but then dropped it when she decided to sue her insurer.
Cher Luisi, who had recently finished renovating her condo when it was flooded by Hurricane Ian, went directly to a Miami “shark” lawyer, instead of filing an official complaint.
Patronis said he was satisfied with the fines that carriers facing disaster-specific fraud would receive – which were up to five times higher than average. The Office of Insurance Regulation has not fined any companies, but the State is still investigating the fraud allegations that were raised in The Washington Post’s investigation of Heritage’s possible rewriting of Assessor Reports.
Heritage, in its earnings report for the fourth quarter of 2022, reported a profit of $12.5million, up from $49.2million a year before, as Florida policyholders filed millions of dollars of Ian claims.
The fourth quarter saw the company earn four cents per dollar of revenue, while paying 62.4 cents out to claimants.
Florida’s insurance crisis
Florida’s property insurance premiums are among the highest in the United States, with an annual average of $6,000. This is a 42 percent increase over last year.
Friedlander claims that the reason for higher insurance prices is civil litigation and exorbitant compensation related to natural disasters which are non-stop due to climate changes.
Friendlander explained that insurers in the state have been forced to declare bankruptcy and stopped issuing new policies.
A 2022 Florida Division of Rehabilitation and Liquidation report on insurance companies that failed revealed they had suffered poor management due to insufficient reserves for claims, asset degradation and natural disasters.
Quinn stated that due to the over harvesting of premiums by smaller companies, they are not able to cope with a surge in insurance claims during hurricane seasons and collapse.
Florida’s hurricane damage has ranged from $3.7 to $49 billion over the last 25 years, which makes it a less attractive market for airlines.
Data from Florida Office of Insurance Regulation shows that as of 16 June, just $16 billion of Ian losses was insured.
Citizens Property Insurance, the state-owned “insurer last resort,” has seen its policies nearly triple in four years due to insurers closing lines or raising premiums. There will be 1.2 millions state-backed policies in April 2023. This is up from the 419,000 that were issued in April 2019
More than 521,000 property claims related to Ian have been made; approximately 82,000 are still unresolved.
The Parkwoods homeowners’ association contracted SouthernCAT after Hurricane Ian to remove mold from the houses and repair the damage caused by the flood. Acentria Insurance Agency sold Heritage’s insurance to the community and recommended this company.
News-Press/Naple Daily News reviewed the meeting minutes, emails from board associations, insurance documents, and additional documentation that was provided by a member of a Phase 6 condo association.
Heritage will pay up to 100 percent of each townhome’s repair costs based upon the policy summary for the community between May 2022 and May 2023.
Heritage did not respond to the first mold remediation request and undervalued the bigger repair demand.
The News-Press / Naples Daily News reported that he did not understand the reason why the company had yet to acknowledge or pay out the emergency claim. He also didn’t comprehend why the second claim was low-balled.
Powers stated that by the close of business the next morning, he will cut a cheque to the local community. SouthernCAT can then remove the lien.
Law allows carriers to defer payments for up to 90 days, if they feel a claim to be suspicious. Alvarez or Powers, however, were unaware that Heritage had been investigating the emergency mold removal claim.
Powers: “I think insurance companies try to do what’s right, even if they aren’t perfect.”
Heritage’s meeting minutes for January warned that insurance rates will increase if Heritage does not cancel the policy.
You are apathetic towards insurance companies.
Alvarez reported to The News-Press/Naples Daily News in mid-August that Heritage settled the Parkwoods VI claim and Lindquist confirmed she had contributed. Still, there are liens and all remains as it was: A monument to the destruction caused by hurricane Ian.
Heritage Heritage has suffered no consequences other than some bad press.
Quinn claims that Florida’s soft laws allow insurance companies to ignore or postpone payment of their claim.
Quinn believes that Patronis, DeSantis, and the other members of Congress should be more aggressive in pushing for stronger penalties to combat insurance fraud committed by carriers. These include criminal prosecutions against executives at carriers who give out low or no returns on their claims.
Quinn believes that the insurance industry is not being enforced. You can’t say that fining a company $25k for a theft of a million bucks is a deterrent.
It is up to the State Attorneys to decide whether criminal charges will be filed.
Patronis: “If they do wrong, we will punish them until they won’t be doing business with Florida any more.”
American Integrity Insurance, Citizens Insurance, People’s Trust, and First Protective Insurance all received complaints regarding Ian.
As the Office of Insurance Regulation (which investigates insurance carriers) declined to provide any comment, it is not clear if there are any investigations underway.
During his political campaigns, Patronis has received over $2 million as donations to his PAC from executives and insurance companies. Heritage has contributed at least $100k to the race. The amount of money donated by carriers to Democrats over the same period is not known. In Florida, the insurance industry donated about $74,000,000 to Florida politicians. This includes the Florida Republican Party that currently controls the state.
Ben Wilcox said that these donations were neither unusual nor extraordinarily high. Wilcox has called this “legal bribery.”
Wilcox explains that “they don’t contribute because they want a good government, but they hope the government is good to them in regulation.
Lori Lindquist was the President of the Homeowner’s Association in April. Heritage, which had been refusing to pay the claim and responding only intermittently to her inquiries, refused to do so for many months. Heritage soon became the target of a state-led investigation.
Lindquist informed members that Heritage responded to her complaint after she made it. The minutes of the meeting held by the Homeowner’s Association in May 2023 show that the community was frustrated with Heritage for its delay.
According to the Board, “we prefer to avoid litigation. But if it is necessary, we’ll do this to ensure that the claim gets paid. “.
McQuagge remarked that it is hard to litigate for small claims such as Parkwoods. SB-2A was signed by Ron DeSantis, Governor of Florida, on 16 December 2022. It attacked Florida Statute 627.348, a law referred to in the press as “David and Goliath”. This stripped policyholders their rights to sue. Due to the law, carriers had to pay their clients’ legal fees when they filed a lawsuit, which made it easier for those with minor claims and low-income policies to get to court.
McQuagge stated, “You no longer have the right to take on an insurer as a condo association or HOA.”
SB-2A, as its supporters claimed, was meant to cut premiums and limit lawsuits brought against insurance firms.
McQuagge explained that “the new Senate bill denies these consumers the right to go to court.”
Patronis said SB-7052 is a consumer protection act that will keep the insurance industry in check. McQuagge disagreed, saying it lacks teeth and only requires insurers to carry out what they are already doing.
I don’t know if consumers were protected despite the appearance that they had been. McQuagge’s opinion was that the insurance companies anticipated claims from hurricanes.
Each storm makes them frightened
Heritage and others have been successfully delaying or denying claims for 11 months.
Alvarez Jackson has had a construction area around them since October. Jackson’s daughter’s bedroom walls were covered with yellow caution tape while they replaced drywall. They used transparent plastic sheeting attached to the studs. After tearing down the ceilings, wires and overhead lighting are exposed. They pulled up the flooring themselves to remove even more mould.
Despite wanting to build their home in Punta Goorda, the couple is worried about how they will sell their existing townhome. In this state, who would be interested in buying it?
Alvarez & Jackson, in June of this year, felt stuck and uncertain inside their home that was only half finished.
Jackson said: “Heritage, it’s just a joke.” “.
He nodded. “Five Months without Inspection?” “Five months without an inspection?”
Jackson pointed out the things he’d accomplished, like scraping off concrete, purchasing cheap carpets and installing them.
Alvarez replied, “To make it livable. “.
The roofs of these people can only be covered with tarpaulin and hope they will last the next storm. It’s unlikely to be repaired on time.
Jackson muttered helplessly, It’s a bit like PTSD whenever it rains.
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