Sunday, February 20, 2005

A Dozen Lawsuits

"More than a dozen cases were lodged against Citizens in Escambia and Santa Rosa counties the past week, along with lawsuits against other insurers," according to Tallahassee bureau chief Paige St. John of Gannett News Corp.

The lawsuits follow Citizens' preemptive attempt to find a friendlier court who will overruled the 2004 Mierzwa decision of Florida's 4th District Court of Appeals. As this blog described earlier:
Citizens simply doesn't like the rule of law followed in the Florida case of Mierzwa v. Florida Windstorm Underwriting Assn., 877 So.2d 774 (4th DCA 2004). It's decided to challenge that existing rule of law by suing one of its customers in another court, sending intimidating letters to the others whose homes have been destroyed by a combination of wind and local ordinances that require the home to be torn down if it's more than 50% damaged, and then use the pending lawsuit as an excuse not to adjust windstorm claims for the next several years.
St. John reports that because of Citizens's litigation tactics "home and business owners with 2004 claims for total losses may have to wait years for insurance companies and courts to decide how much damage was wind, how much was water and who must pay."
While insurance companies and policyholders battle in court about dividing the losses, claims are paid only partially or not at all, even if they're not part of litigation.
St. John also writes that "among those also facing litigation are Allstate Floridian, USAA, Florida Select, Vanguard, Universal Property and Casualty and Southern Family Insurance."

The Leon County attorney who won the Mierzwa case estimates that "as many as 15,000 policyholders would be affected" by a class action he has filed against Citizens for policy holders who have not settled their claims. In that regard, St. John unearths an interesting paradox. Although Citizens tells the public it has only 2,400 open claims left from Hurricane Ivan,
"Citizens would not reveal how many claims it refuses to pay in full."
Hey! Wait just a minute! If Citizens is telling the public that it has settled all but 2,400 Ivan claims, in how many of the 'settled' cases did the company ignore the Mierzwa decision, pay nothing, close the case, and kiss off the customer?

Apparently, the company won't say.

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