Wednesday, December 22, 2004

More Agenda Items

A few days ago, I suggested some agenda items for improving hurricane insurance law during next year's state legislative session. Today's news points to a couple more.

* * *

Beatrice E. Garcia reports in the Miami Herald that state Insurance Commissioner Kevin McCarty told the Florida Cabinet yesterday, "81 percent of the 1.5 million claims filed with insurers have been closed and homeowners have collected funds to repair their homes."

However,"291,406 claims remain unfinished." The cabinet also was told "the process of settling claims had been bogged down in recent weeks" as more citizens complain "about delayed adjustments, payments and disputed settlements."

So, if a "settlement" is "disputed" does it still get counted in the 81 percent of claim cases that are counted as "closed"? Apparently so. And what percentage of those "closed cases" in fact are being "disputed"? Your guess is as good as mine. No one at the Department of Financial Services is saying.

Garcia's dispatch also includes news that most other newspapers seem to have overlooked. The state cabinet was told 50 out of 226 licensed property insurance companies have failed to submit required affidavits to the Florida Financial Services Dept.

That's a non-compliance rate of over 22 percent!

Two months ago, state CFO Tom Gallagher required all Florida property insurers to affirm in writing that "they were paying additional living expenses to qualified policyholders and had made at least an initial assessment of all the storm damage."

So, who are the companies that failed to obide by Gallagher's order? According to reporter Garcia, unnamed "regulators" assert that state law prohibits them from publicly identifying them.

If that's true, there's another reform for the legislature to enact next year. What kind of law allows state government to shield the names of licensed insurance companies who don't obey state law?

* * *

The Palm Beach Post is carrying what looks like a re-write of wire service reports on yesterday's Florida state cabinet decision to extend "until March 31 a moratorium that prevents insurance companies from canceling policies on homeowners with outstanding hurricane damage claims."
Under the rule, companies can't cancel or not renew policies for at least 60 days after the hurricane-related repairs are completed.

The moratorium, which was [administratively ordered] last month, would have ended Dec. 31 if the Cabinet had not acted.

Florida Department of Financial Services spokeswoman Tami Torres said it isn't known how many homeowners are awaiting repairs, but the number of blue tarps adorning roofs throughout the state gives some indication of the need for the rule.

"Even though the insurance company might cut the check, we don't know the number of people on lists waiting for contractors," Torres said. "We do know there are still people waiting."
Here in Pensacola, published estimates are that it may take roofers two years or more to finish repairs to hurricane damaged homes. Either the cabinet will have to extend the moratorium again and again and again. Or, better yet, as CFO Gallagher himself suggested during the recently-concluded special legislative session, the legislature should step up to the plate and pass an act prohibiting all insurers from "canceling policies on homeowners with outstanding hurricane damage claims."

There also should be a ban against canceling or refusing to renew a homeowner's policy for at least one year after a hurricane claim has been paid and repairs completed. For many, the fear of cancellation hangs so heavy that it can tempt them to forego their rights in hopes of avoiding retaliation.

I'd guess at least 22 percent of the insurance companies in Florida aren't above taking advantage of that situation. But I can't tell you who they are. Apparently, it's against the law to identify them.

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