Article Courtesy of The Sun Sentinel

By Maria Mallory White

Published March 7, 2013

Claiming a controversial home reinspection program was unfair, attorneys filed a class-action lawsuit in Broward Circuit Court on behalf of nearly 270,000 Florida homeowners denied rebates by Citizens Property Insurance Corp.

Those homeowners, including Hollywood Commissioner Patricia Asseff, are entitled to $190 million in discounts on their policies, according to the lawsuit announced Thursday.

Asseff, the lead plaintiff, wound up losing $8,200 in discounts on her annual premium. Asseff's policy on her East Hollywood home, which at the time was valued at $690,000, went from $4,500 to $12,700 in one year after credits for her roof were revoked.

The roof had not changed in any significant way, said attorney Todd Stabinski. After she asked for another inspection, Citizens granted Asseff $500 more in mitigation discounts, he said.

Seventy-four percent of Citizens policyholders subjected to reinspections lost the credits Citizens previously had granted them for wind-mitigation improvements made to their homes when inspectors showed up beginning in 2010 using a new form to evaluate their properties, according to plaintiff attorneys.

"We feel that is just changing the rules in the middle of the game," said plaintiff attorney Gary Farmer of Fort Lauderdale.

In an email Thursday, Citizens spokesman Michael Peltier wrote, "Our position is Citizens' reinspections were conducted under statutory authority afforded any insurer to verify, at the insurer's expense, the accuracy of inspection reports submitted for a mitigation discount."

He added: "Citizens used the mitigation form in effect at the time of the reinspection as adopted by the Financial Services Commission. Criteria established in 2007 was revised in 2010 and 2012. Since a new form had been adopted by the FSC, the earlier version was replaced and not valid for the full five years as stated in the complaint."

The attorneys who filed the lawsuit said Citizens' actions were motivated by its desire to increase revenues, and the timing of adopting the new form reflected that — and also represented a breach in contract.

The form at issue, the 2007 version of Citizen's Mitigation Form, provided in writing for a five-year discount, Farmer said.

"Nobody held a gun to their heads for Citizens to institute this [new] reinspection form," said Farmer. "They decided to apply it proactively."

Citizens' revamped its reinspection program late last year after months of public outcry. Subsequently, nearly half of the homeowners contesting the reversals on discounts succeeded in having some or all of them restored. At the end of 2012, Citizens had completed 479,969 reinspections statewide, said spokesman Peltier. He estimated about 12,000 remain and should be completed soon

The move comes as the Florida Legislature gets underway next week and lawmakers gear up once again try to reform the state's large property insurer with 1.3 million policies, Citizens insures 191,092 properties in Broward and 133,589 in Palm Beach.

According to Karen Watson Polivka, Regional Director of the Florida Association for Insurance Reform (FAIR), the nonprofit, nonpartisan advocate for balanced insurance policies sought a meeting with Citizens to discuss problems with the reinspection program. After canceling a meeting scheduled for Sept. 20, 2012, Citizens failed to meet with FAIR.

"Citizens had every opportunity to respond and take action to fix this program," Polivka said. "The policy holders wronged by this program now look to the courts for redress."

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