Insurer takes heat at hearing

Article Courtesy of The Palm Beach Post

By Randy Diamond
Published June 20, 2007

DAVIE About 100 people attended a hearing Tuesday held by the task force reviewing Citizens Property Insurance Corp.'s remaining claims from the hurricanes of 2004 and 2005, many of them angrily pleading for help.

Some of them agreed to settlements on the spot and were promised checks would soon be in the mail, as Citizens representatives were present and authorized to close cases.

But most of them had to settle for the satisfaction of venting and hearing words of reassurance that cases will be closed.

The chairman of the task force investigating Citizens' claim-handling practices listened patiently as the meeting extended past its scheduled closing time.

While Bob Milligan stopped short of any promises, he said he was determined to help resolve as many of the remaining 3,500 hurricane claims as possible.

But Milligan, who also serves as the state's insurance consumer advocate, provided some details about what might be in the task force's report scheduled for release July 1.

He said that Citizens will be given 90 days to resolve the open claims.

After that, it will be required to provide detailed specifics on each case as to why it remains open.

Milligan said the task force report also will give Citizens 30 days to provide details about the training programs for its contract adjustors.

The state's largest insurer has contracts with 45 adjusting firms representing 6,000 adjusters that would come to Florida if needed during 2007.

He wants to ensure the mostly out-of-state contract adjusters can do their jobs properly if called to Florida to handle hurricane claims.

Citizens officials have said many of their adjusters were trained on the fly in Florida to deal with the catastrophes, although they don't admit that led to inadequate estimates.

But the quality of those adjustments was the number one topic at the hearing, held at Nova Southeastern University in Davie.

In attendance were policyholders, lawyers and public adjusters who represented policyholders in their claims.

Catherine Craig of Jupiter said her house was severely damaged by hurricanes Jeanne in 2004 and Wilma in 2005, but Citizens has paid just $70,000 of the $475,000 she said she is owed.

Craig, a mortgage broker, said she has spent every dollar she has made the past three years on repairs to her house, which have not been reimbursed.

"The mold remediation, the new air conditioning, the drywall, electrical plumbing - all paid out of my pocket because Citizens has denied, denied and delayed, delayed,'' she said.

Another theme that was echoed at Tuesday's meeting was that Citizens had refused to negotiate in good faith over disputed claims at state-sanctioned mediation hearings.

The mediation is designed to resolve disputes over the amount of damages, but policyholders and their lawyers said Citizens claims personnel would refuse to negotiate.

Those charges were confirmed by Mark Pritchett, executive vice president of the Collins Center, which runs the mediation program.

He said he was concerned Citizens claims personnel were being told by superiors not to resolve disputes at the hearings.

Citizens officials denied that they refused to settle valid complaints.

Top Citizens claims personnel who attended Tuesday's meeting did resolve some outstanding hurricane claims on the spot, including the claim of West Palm Beach resident Larry Stout.

The engineer said Citizens last year had refused to pay more than $8,500 to replace the aluminum siding of his house, which was damaged during Hurricane Wilma.

Stout spent $15,000 on the renovation.

After he voiced his complaint to the task force, Citizens personnel took him aside and upped their offer to $12,500. Stout said he felt the new offer was fair.

Citizens Vice President Suzanne Murphy, who attended Tuesday's meeting, said Citizens has had valid reasons for denying some of the 3,500 open claims, but could not disclose them because of confidentiality issues.

But she agreed the state-sponsored insurer, which has some 1.3 million policyholders, had botched some claims and needed to do better.

"We will win back the respect and trust of our policyholders,'' she said.