Katrina Insurer Loses

[Vinatieri for Prez]

State Farm loses its first case in its refusal to properly insure Katrina victims.

http://www.msnbc.msn.com/id/16579242/

Not only do they have to pay, but there is a big punitive award as well. I'm sure it will be appealed but this is a good first step. As someone with a good knowledge of the insurance industry, I am glad these guys got taken to the woodshed. As they say, the insurance companies are always your best friends until something happens and then its time to pay up.

[SirFozzie]

Like a good Neighbor? State Farm is Toast... :D

[molson]

Not only do they have to pay, but there is a big punitive award as well. I'm sure it will be appealed but this is a good first step. As someone with a good knowledge of the insurance industry, I am glad these guys got taken to the woodshed. As they say, the insurance companies are always your best friends until something happens and then its time to pay up.

Will this make home insurance in the gulf completely unaffordable? I'm glad that these victims are compensated, but if I'm an insurance company, why do I want to go anywhere near that area ever again, if I seemingly have a "beyond a reasonable doubt" standard I have to meet when trying to prove water v. wind?

[sabotai]

Will this make home insurance in the gulf completely unaffordable? I'm glad that these victims are compensated, but if I'm an insurance company, why do I want to go anywhere near that area ever again, if I seemingly have a "beyond a reasonable doubt" standard I have to meet when trying to prove water v. wind?

http://wjz.com/local/local_story_355113151.html

Allstate To End Homeowners' Insurance On Md. Coast

As WJZ's Mike Hellgren reports, starting in February, the company will no longer offer new property insurance in all or part of 11 counties, mostly along the Chesapeake Bay. Allstate will continue to renew existing policies even in those areas, a company spokeswoman said.

"We have been looking at hurricane and storm projections, and we're going to see a lot more severe storms further north on the coastline," Allstate spokeswoman Debbie Pickford said. "We are working to minimize our risk."

The move affects residents in Calvert, Dorchester, Somerset, St. Mary's, Talbot, Wicomico and Worcester counties and parts of Anne Arundel, Charles, Prince George's and Queen Anne's.

Stung by losses from major storms including Hurricane Andrew in 1992 and Hurricane Katrina last year, insurance companies have been raising rates or dropping coverage in southern coastal areas, particularly Florida. With many scientists predicting an upturn in the frequency and intensity of hurricanes, the trend is spreading north.

Allstate also decided recently not to write new homeowner policies in all of Delaware, Connecticut and New Jersey and parts of Virginia. And it's letting thousands of policies lapse in the Carolinas, New York and Texas.

[SackAttack]

Will this make home insurance in the gulf completely unaffordable? I'm glad that these victims are compensated, but if I'm an insurance company, why do I want to go anywhere near that area ever again, if I seemingly have a "beyond a reasonable doubt" standard I have to meet when trying to prove water v. wind?

Honestly, I don't give a shit about the hardships this ruling could cause insurers after reading the following:

State Farm and other insurers say their homeowner policies cover damage from wind but not from water, and that the policies exclude damage that could have been caused by a combination of both, even if hurricane-force winds preceded a storm’s rising water.

Really? You mean that if one drop of water touches my house after the winds have leveled it, you've written it into your contract so that you can screw me out of the coverage I've paid for?

Pardon me if I don't weep for State Farm here.

[Flasch186]

god forbid they actually, really, insure anyone and have some sort of moral obligation to "insure".

[st.cronin]

Insurance is the biggest fucking scam there is.

[Dekanth]

Homeowners in the area (and all areas of the country) are not forced into buying from State Farm, Allstate, or any particular company. Further, they should take it upon themselves to know what they are buying, what is covered and what is not covered. So SackAttack, you didn't actually pay for that coverage that they are screwing you out of, they didn't change the contract midterm.

On top of all of that, flood coverage is available everywhere in this area and most areas of the country. It was the homeowners option to buy flood insurance or not, and many, many people decided to save a buck, again not only here, but in 95% of the country flood insurance is not purchased by the consumer.

I cannot understand why somebody does not take the utmost care to protect the single largest investment they will make in their lifetimes, through both purchasing the proper amount of insurance and maintaining a proper level of preventive care.

Large companies actually do the homeowner a favor by insuring in high(er) risk areas. There won't be a single tear shed by Allstate or State Farm when they pull out of high risk areas and concentrate their marketing and sales into low risk areas.

Insurance may be a scam, but don't blame the insurance companies, blame your state's insurance department. They are the ones who tell the insurance companies exactly what their contracts can and can't say and even regulate the prices they can charge (both maximum AND minimum prices). Nobody forces you to buy insurance, ever, except of course your state government when it comes to cars and your mortgage company when it comes to houses. Insurance companies take the brunt of the criticism, pretty unfairly IMO.

[Flasch186]

the judge begged to differ....so I guess the person writing the contract decides its interpretation? Not so fast.

I paid for mold insurance but not flood.

Insurance co. :Well the damage isnt the mold it was the water from the flood....

you: But the flood is gone now the mold, that was caused by the flood is what's keeping me from living here....I pay for Mold remediation coverage!

Insurance co.: We clearly see this all starting from the flood which youre not covered from.....sorry.





phoeey on the insurance companies. and its easy to say get insurance but when the rackets pull out of an area, and leave only the scum of the scum to insure, its easy to say, "take your pick." when its crap to begin with and youre dealing with the devil from the word, "go."

So its the insurance company using loopholes to screw over their customer...ahem, their customer? And thats ok? This slippery slope can take us all the way down to murder if you wanna start using loophole exploitations and in the same sentence say, "hey theyre just using whats available to them...and that is ok." BS

[TroyF]

I have so many things to say on this topic, but I really like my job. :)

I will say that SF is one of the better companies I deal with and are a LONG LONG way ahead of the worst.

[JPhillips]

Dekanth: You make it sound like the insurance companies are non-profit do-gooders. They make plenty of profit and as you might have said, nobody forced these people into the insurance business.

In this case, though, I think its a perfect example of why we need a federal bailout. The insurance companies may be acting like bastards, but they can't afford to cover everything. The fact is that there is so much devastation that private insurance companies can't afford to cover it all. We need federal leadership to help fix the problem. This was a once-in-a-lifetime storm and we can't approach rebuilding in the normal way.

Unfortunately I don't see any leadership coming, so we'll muddle through in a series of court cases.

[JonInMiddleGA]

I think its a perfect example of why we need a federal bailout.

Once again, you could probably have managed to come up with something I disagreed with more ... but you would have really had to work at it.

[Toddzilla]

And then there is me - typical upper-middle class middle aged white guy - who's house is broken into, and State Farm bends over backwards to help me out. After the deductible, they took care of every expense, even arranged to have a company come to my house to clean up the room that was broken into of all the glass and dirt. And they cut me a check for all of the expenses in less than a week, some of which I haven't even paid yet.

They're definitely good neighbors to me, but maybe that's just because I'm in a good neighborhood. ;)

[Flasch186]

or it was a minor amount of money, and the cost-profit long term analysis otherwise known as "risk" vs. your payments show youll be very profitable in the future. just a thought.

[st.cronin]

or it was a minor amount of money, and the cost-profit long term analysis otherwise known as "risk" vs. your payments show youll be very profitable in the future. just a thought.

Well, duh.

[Dekanth]

I just want to say, there is a federal bailout. Its flood insurance, which is written by the government, not private insurers. FEMA.

I wasn't trying to imply that insurance companies are not for profit, in fact just the opposite. They are in it to make money, that is why there are so many exclusions in a homeowners policy, but they are all layed out in front of the buyer beforehand.

[JonInMiddleGA]

It's not what most people want to hear, but Dekanth raises some pretty good points.

[Flasch186]

I just want to say, there is a federal bailout. Its flood insurance, which is written by the government, not private insurers. FEMA.

I wasn't trying to imply that insurance companies are not for profit, in fact just the opposite. They are in it to make money, that is why there are so many exclusions in a homeowners policy, but they are all layed out in front of the buyer beforehand.

However in most states, Florida for sure, youre required to have it to get a loan, so unless youre paying for a house in full w/ cash, youre stuck to choose from the few shysters who are still here....BTW the 2 I know that are accepting new policies have nice offices in Grand Cayman. So with the admitted exclusions, the attempts to avoid payouts, I would say, definitionally, this is a racket and is indefensible....While you can say a homeowner didnt have a gun held to their head when they signed the policy, if they ever intended to move into the home in the first place, they might as well......

unless of course youre saying the contract is negotiable.

[JonInMiddleGA]

While you can say a homeowner didnt have a gun held to their head when they signed the policy, if they ever intended to move into the home in the first place, they might as well......

And there's some compulsion requiring people to buy a home in these high risk areas?

[Logan]

And there's some compulsion requiring people to buy a home in these high risk areas?

Well, by definition, a property is considered to be in a flood zone and therefore requiring flood insurance if it is in an area that has just a 1% chance of being flooded in a given year. So even in the "low risk" flood zones (i.e. not New Orleans), that gives it a 26% chance of a flood occurring over the life of a 30 year mortgage.

[JPhillips]

Dekanth: I generally agree with what you're saying, just in this case I think we need to change the rules so we can get the region back on its feet.

When I was looking at homes in Jackson I specifically passed on a nice house because it was in the 100 year flood plain and I didn't want the added expense of flood insurance. I was told by many to get the house and forget about flood insurance, but I wasn't willing to take that risk.

People should know about flood insurance, but we shouldn't cripple the entire region when we have the resources to combat a major catastrophe.

[Mr. Wednesday]

After spending time in Houston, there's a pretty good likelihood that I would buy flood insurance there even if I didn't live in a flood plain. If you drop enough rain on a flat area (*cough*Allison*cough), it'll flood whether or not it's a flood plain.

[Tigercat]

Here is an example of how State Farm got over on my family.

My Grandparents were in their mid 80s and living in Waveland, MS, near where the eye hit. Neither intended to live as long as they did, so when they were running low on retirement funds a few years ago they had to take out a reverse mortgage. This ended up a good thing, because they had the money for the house without fighting State Farm. They had insurance for BOTH flood and wind(home owners.)

Their house was completely destroyed by the storm. Their house was on 20+ foot stilts 5 miles from the coast and never got flooded or wind damaged in 20 years. You can't get flood coverage for contents so they had their contents of their house covered by State Farm home owners policy.

State Farm said that it was purely the tidal wave that took the house away. Never mind that the national weather service said that that area of Waveland had 150 MPH winds before and after the big surge hit. Never mind that it was an old roof that would have been taken off by winds and the contents thereby damage by rain and wind before the wave hit the house. Never mind that these insurance companies SELL CONTENT PROTECTION in these areas for situations like these were a hurricane destroys your house with all of its arsenal, and then a company like State Farm goes against the independently verified facts to screw 85 year olds out of their money.

So we went to mediation 7 months after the storm. By now we lost my Grandfather as a result of moving after Katrina. My Grandmother went to the mediation as well, but she was/is in poor health and needs assisted living and as much money to support that as possible.

The insurance company saw her, and saw us, and knew we needed money ASAP and couldn't afford to get lost in the courts. My Grandparents contents were all lost and insured for 75k, what does State Farm say? "We will pay for the roof that was damaged by the wind, but everything else our expert says was destroyed by water." (5k) So they will admit the roof was torn off first but won't pay for all the contents that were damaged before the surge got there (Never mind not knowing for sure if the wave or the wind shredded the house and carried it away.) Another kicker: their engineer photographed the WRONG HOUSE SLAB! But still, the insurance company would only offer 15k.

They had us. They knew we couldn't go to court and take no money and risk no money anytime soon. They are suppose to be selling protection to people but instead used tactics to take away what was promised to a 85 year old women who lost everything, including her husband, and needs money to survive right now. How they looked across that table at her and felt ok with themselves is beyond me.

Sorry for the long personal experience post, to summarize, SCREW STATE FARM.

[Dekanth]

Dekanth: I generally agree with what you're saying, just in this case I think we need to change the rules so we can get the region back on its feet.

When I was looking at homes in Jackson I specifically passed on a nice house because it was in the 100 year flood plain and I didn't want the added expense of flood insurance. I was told by many to get the house and forget about flood insurance, but I wasn't willing to take that risk.

People should know about flood insurance, but we shouldn't cripple the entire region when we have the resources to combat a major catastrophe.


Hey, I never said the system is right, but insurance companies bow to the will of the state if they want to sell insurance in that state. I'm also not saying that some people didn't get a raw deal in the aftermath of Katrina.

If you figure 5% (making up a number here) of customers have complaints in normal everyday insurance claims, then in the aftermath of Katrina, that 5% adds up to a pretty big number. Some people misunderstood what they paid for, others I am sure genuinely got 'ripped off'. It happens and it sucks when it does. I know that Allstate, State Farm, Farmers, etc... have paid out so many millions in claims, as well as countless hours in humanitarian work and charitible donations as well. But a 5 million fine for a customer who got ripped off is excessive. Insurance fraud and ridiculous payouts like this is what causes your premiums to go up. It is what causes more and more exclusions written into your policies. It is what causes good companies to pull out of regions and leave the scheisters as the only ones doing business.

Insurance is a business just like any other for profit business, and I have no problems with them, but I do admit there is probably fraudulent acitivity going on, but no more than most other businesses, IMO. They take a big brunt of blame because, and this is just my opinion, people HAVE to have car insurance and it is freaking expensive! Banks require home insurance and that is freaking expensive too! People hate having to buy this stuff because they are told too and the blame is transposed unfairly onto insurance.

Tigercat, I am sorry to hear of your situation. Like I said, I think it sucks when stuff like that happens. Insurance companies are not bulletproof, by no means at all, despite my defense of them here.

[Dekanth]

If I can stray off topic a bit, does it piss anybody else off when you hear those feel good stories about a family's house or business burning to the ground and it turns out they had no insuance, so they start a pledge drive to raise money to rebuild? Makes me wonder why I pay good money each year for my insurance. Maybe I am just a heartless bastard.

[Dekanth]

However in most states, Florida for sure, youre required to have it to get a loan, so unless youre paying for a house in full w/ cash, youre stuck to choose from the few shysters who are still here....BTW the 2 I know that are accepting new policies have nice offices in Grand Cayman. So with the admitted exclusions, the attempts to avoid payouts, I would say, definitionally, this is a racket and is indefensible....While you can say a homeowner didnt have a gun held to their head when they signed the policy, if they ever intended to move into the home in the first place, they might as well......

unless of course youre saying the contract is negotiable.

John was correct in his response. If you can't afford everything that comes with buying a house, and are able to self insure for the things you cannot get insurance for, you really have no business buying that house in the first place, sad to say.

[RendeR]

Wow, there is some seriously insane elitist bullshit flying in this thread.

Not going to dig into anything but one point:

Insurance companies get away with completely rediculous BS by requiring seperate flood insurance on top of a homeowners policy. My homeowners policy covers every other natural disaster, anything that could POSSIBLY happen to this house, but does not even touch flooding. Its ignorant and its something that needs to be corrected.

People pay out small fortunes for insurance there is no plausible reason for this one type of natural damage to be cut completely out of standard policies.

Other of course than greed.

I hope the entire industry gets its ass hauled and some real regulation put in place to tone down the money sucking black hole that is the US insurance industry.

[JonInMiddleGA]

Wow, there is some seriously insane entitlement bullshit flying in this thread.

Fixed that for you.

[RendeR]

John was correct in his response. If you can't afford everything that comes with buying a house, and are able to self insure for the things you cannot get insurance for, you really have no business buying that house in the first place, sad to say.

So, because the system is designed to suck your income away for something that should be totally inclusive (loss or damage of the home) that, because the industry wants to force people to pay rediculous amounts more to cover one specific form of damage (flood) people have no business buying property?

Why?

If this were something limited to high flood damage areas I MIGHT be inclined to agree with you, however this is nation wide. There is no distinguishing between high and low risk flood zones, you always have to buy flood insurance seperately and frankly, thats rediculous.

[RendeR]

Fixed that for you.


Fixed? nay. Changed to suit your self centric view.

[Vinatieri for Prez]

I just want to say, there is a federal bailout. Its flood insurance, which is written by the government, not private insurers. FEMA.

I wasn't trying to imply that insurance companies are not for profit, in fact just the opposite. They are in it to make money, that is why there are so many exclusions in a homeowners policy, but they are all layed out in front of the buyer beforehand.

This along with your other comments is complete B.S. These policies are often written purposefully in confusing and ambiguous language. I have fought insurers in the courts over contract language. They will often apply the most ridiculous interpretation of their own frickin' language to avoid paying a costly claim. They will then use that to hold out as long as possible before paying - so you either go away or accept a settlement for less. I have experience reading these policies. I sometimes have to read them 10 times over just to get an idea of what might be covered. Now you expect the average consumer to do it?

As Flasch said, the court in this case looked at the language at issue and obviously decided it clearly covered the damage, yet State Farm contended it did not. This was a case where the homeowner read their policy, knew what it covered in advance, had that happen, but that had State Farm say no dice. Please no insurance apologists needed here. That example above regarding the grandparent is a classic and repeated in every area of insurance by virtually every insuranc company.

Nice try going further by blaming the state insurance departments. They are the only thing standing between what would be a complete raping of the public in the industry.

As for the business side of this are you kiddin' me with a federal bailout of the insurance companies? Believe me, they have more than enough in reserves to cover this. As for pulling out of insuring certain areas, so be it. No matter where you are located, in virtually all instances there is money to be made and another insurance company will step in. If not, we can look at alternatives such as a government-aided insurance setup.

Please, do not weep for State Farm.

[Mr. Wednesday]

So, exactly where is the money to pay for the settlements under the additional coverage going to come from?

[Mr. Wednesday]

RendeR, specifically regarding flood insurance...

...if I don't live in an area where flooding is a realistic possibility (and inland, at the top of a hill qualifies IMO), why should I have to pay for flood coverage?

Conversely, there's a reason why the federal government is involved in insuring areas that actually do flood.

[sabotai]

As Flasch said, the court in this case looked at the language at issue and obviously decided it clearly covered the damage, yet State Farm contended it did not.

Not entirely accurate.

From article:

"State Farm and other insurers say their homeowner policies cover damage from wind but not from water, and that the policies exclude damage that could have been caused by a combination of both, even if hurricane-force winds preceded a storm’s rising water.

Senter, however, ruled that State Farm couldn’t prove that Katrina’s storm surge was responsible for all of the damage to the Broussards’ home. The judge also said the testimony failed to establish how much damage was caused by wind and how much resulted from storm surge."



That is why the judge ruled against them. If State Farm was able to show that the damage was caused by the "combination of wind and flood" (ie, storm surge), they would have won. In other words, the judge definitely does state that the policy would not cover the storm surge, but he ruled against State Farm because they could not prove the storm surge is what caused all of the damage.

[Tigercat]

State Farm and others say that policies say that. But the bottom line is even if that is true, they have to prove that indeed wind didn't damage first.

In other words, they would have to prove that if the wind and water did the damage together, that they more or less came at the same time.

Just like if wind damaged your home on Tuesday and on Wens flood destroyed the rest, the wind damage would be covered by homeowners and not flood, the same is true if 120 mph wind destroys most/all of your house at 2pm and at 3pm the water finishes the job.

Edit to add: (This is more or less what the Insurance Law Lawyer who mediated our case told us too.)

[Vinatieri for Prez]

Not entirely accurate.

From article:

"State Farm and other insurers say their homeowner policies cover damage from wind but not from water, and that the policies exclude damage that could have been caused by a combination of both, even if hurricane-force winds preceded a storm’s rising water.

Senter, however, ruled that State Farm couldn’t prove that Katrina’s storm surge was responsible for all of the damage to the Broussards’ home. The judge also said the testimony failed to establish how much damage was caused by wind and how much resulted from storm surge."



That is why the judge ruled against them. If State Farm was able to show that the damage was caused by the "combination of wind and flood" (ie, storm surge), they would have won. In other words, the judge definitely does state that the policy would not cover the storm surge, but he ruled against State Farm because they could not prove the storm surge is what caused all of the damage.


Based on the wording of the article, you make a good point. My guess however is that the case hinged on two issues: (1) what does the policy say about exclusions; and (2) how did the actual damage fit what was excluded. For State Farm to prevail it would have to win on both issues -- that the policy exluded storm surge and damage was caused by storm surge.

It's not entirely clear whether the court ruled on the first issue. He may have simply stated that "even if" the policy excluded surge, the damage was not caused by the surge and therefore State Farm loses anyway. Essentially, the judge avoids ruling on a point that would not affect the outcome.

By the way, a directed verdict by a judge is very rare. It means the judge basically says "there is no evidence here that a jury could possibly rule in favor of State Farm so I am not even going to bother to let them decide."

For me, denying coverage by either twisting the policy language or twisting the facts related to the damage makes no difference to me with regards to the culpability of the insurance companies here.

[SackAttack]

Homeowners in the area (and all areas of the country) are not forced into buying from State Farm, Allstate, or any particular company. Further, they should take it upon themselves to know what they are buying, what is covered and what is not covered. So SackAttack, you didn't actually pay for that coverage that they are screwing you out of, they didn't change the contract midterm.


Read what I said again.

If the hurricane coverage these people paid for insures against wind damage, and wind totals my house, and you try to weasel out of the claim because rain fell on or storm surge washed over the rubble of my house, then fuck you.

I paid for coverage, and you're trying to weasel out of it thanks to something that came afterward that had absolutely nothing to do with the actual destruction of my house?

I find it hard to have sympathy for any business that goes tits up if its survival is predicated upon scummy behavior.

[sabotai]

It's not entirely clear whether the court ruled on the first issue. He may have simply stated that "even if" the policy excluded surge, the damage was not caused by the surge and therefore State Farm loses anyway.

The article also said that this judge has ruled for the insurance companies in the past, so I took that to mean that he sides with them on the language of the policy (but that may be too much of an assumption for this specifc case and insurance policy)

By the way, a directed verdict by a judge is very rare. It means the judge basically says "there is no evidence here that a jury could possibly rule in favor of State Farm so I am not even going to bother to let them decide." In essence, he is saying State Farm pretty much had no basis to deny the claim on the basis it set forth.

I was gonna ask about that, but forgot. The only time I've heard of a judge doing this was when Law & Order needed a twist ending. :)

[Vinatieri for Prez]

SackAttack, you are bang on there. Dek doesn't quite get what goes on in the insurance business, or . . . . . . . . he works for an insurance company.

This example is repeated over and over in evey insurance context by every insurer:

Homeowner: I bought this policy, read it, and it covers wind damage.
[Wind damage occurs]
Homeowner: please pay me for the coverage I have paid thousand and thousands of dollars for all these years.
Insurance company: It wasn't wind damage, it was something else (and coincedentally that particular damage is excluded under your policy).

[Glengoyne]

Am I the only one who thinks that a storm surge driven by Hurricane winds shouldn't even remotely be classified a "flood"?

[Tigercat]

Am I the only one who thinks that a storm surge driven by Hurricane winds shouldn't even remotely be classified a "flood"?

There is still a great deal of debate along the gulf coast about it. Traditionally and recently, the idea that it is flood has universally won out in courts and in government debate.

[Flasch186]

Ill stick with the lawyer's opinion of the law and the fact that he has dealt with these cases before. Couple that with m y own experience in florida and its numerous flood plains and past catastrophes. Sprinkle in the fact that premiums ALWAYS go up....

side note, about 5 years ago the automobile industry made a countrywide push to make a dent in insurance fraud using commercials that talked about how fraudulent claims are a major reason insurance premiums go up and are so high. Later they made statements about the success of the push and used some statistics to show that insurance fraud was and will be a major problem in the future, however that through education they were able to make a dent in it.......premiums didnt go down $.01 nationally in the same period.

[stevew]

If I can stray off topic a bit, does it piss anybody else off when you hear those feel good stories about a family's house or business burning to the ground and it turns out they had no insuance, so they start a pledge drive to raise money to rebuild? Makes me wonder why I pay good money each year for my insurance. Maybe I am just a heartless bastard.

Maybe "Piss off" is not the right word for me, but it does baffle me when an apartment complex, or something, burns down and none of the people who rented there had any kind of renters insurance. My renters insurance was like 100 bucks per year, and supposedly covered about 40k in personal item damage.

Now I don't discount that they wouldn't have thrown some serious bullshit in there if I ever tried to collect, but 8 bucks a month is worth the risk that I will get paid if something happens to all my stuff.

[miked]

Fuck insurance companies. They are not the poor little kids.

My car was totaled in Boston during a snowstorm. Guy in a 96 Bronco skidded out a snow storm and hit my parked car (as well as 4 others). Mine was a total, as it was a 91 Corrolla (I loved that car). The rest had minor scrapes and dents. It was towed while I was at work, got a note on my door from the po-po telling me where it was. The dude's insurance (Premier) sent a scumbag dude out to photograph it, and took some weird angles and the reflection of the sun made some of the scrapes appear different colors. The insurance company concluded that I was likely hit by a snow plow or something earlier and they would not pay. They also told me a witness at a funeral across the street saw the guy didn't hit my car. They did pay for the other 3 cars though. I had to take them to court, as there were no accidents in the police records and not even a funeral that day. They showed up to court and said they weren't sure what I was talking about, but clearly the damage wasn't from their guy. The judge (or clerk) laughed a little, and ruled in my favor. They pretended to be apologetic, but it was pretty gay.

I had to do hours of work to get police reports, try and hunt down their "witness" and go to court, so they could save $1500 or so. Fuck the insurance companies. The point of their existence is to find any reason not to honor their policy, otherwise they'd all be out of money.

[JonInMiddleGA]

Fixed? nay. Changed to suit your self centric view.

Self-centric?

I'm not the one railing like a lunatic trying to get something that YOU AREN'T PAYING FOR.

Your subsequent remarks about how the policies should be all-inclusive doesn't seem to even begin to consider that such a thing would price homeowners insurance completely out of the range of God knows how many people.
(It's high enough as it is)

[molson]

The point of their existence is to find any reason not to honor their policy, otherwise they'd all be out of money.

So you're basically admitting what nobody else in this thread is - if an insurance company is run the way you'd like it to be, it would be bankrupt in about 8 minutes.

Your story is horrific, but I still feel like that's the exception rather than the rule. I've had great experiences with insurance companies (and I'm extremely careful about who I buy from).

If it's legal, ANY business will try to get away with it - a business is not a moral human entity, and our economic system works better that way. An insurance company has to keep up to be competitive and stay in business. Like someone else said, blame your state government (or the judge in your case for not allowing punitive damages, if he was allowed to do so).

[KevinNU7]

miked, why didn't your insurance company do all that work for you?

[miked]

miked, why didn't your insurance company do all that work for you?

Because they suck as well. I didn't have collision because my car wasn't worth it. As the case was a total loss, they told me it wasn't their problem. I was leaving Boston in a few months and and didn't have time to fight my insurance company to fight theirs. Because it was only $1500, I filed it in small claims court. Point being, my insurance company didn't want to help because it would've cost them time/money. Their insurance company didn't want to pay because they were gambling that I'd give up. It's how these companies make thier money, so I'll just have to scoff when people like Dekanth try and defend them and say the problem is us.

[miked]

So you're basically admitting what nobody else in this thread is - if an insurance company is run the way you'd like it to be, it would be bankrupt in about 8 minutes.

Your story is horrific, but I still feel like that's the exception rather than the rule. I've had great experiences with insurance companies (and I'm extremely careful about who I buy from).

If it's legal, ANY business will try to get away with it - a business is not a moral human entity, and our economic system works better that way. An insurance company has to keep up to be competitive and stay in business. Like someone else said, blame your state government (or the judge in your case for not allowing punitive damages, if he was allowed to do so).

I sort of agree with you. I'm not saying all claims are valid, but the point of the insurance companies is to invalidate as many claims as they can. There has to be some happy medium :cool:

[JonInMiddleGA]

Point being, my insurance company didn't want to help because it would've cost them time/money.

Umm ... so you're ragging on them because they didn't donate their resources when you hadn't paid them to be involved in the situation that arose in this case?

Do you get mad when plumbers that did your bathroom don't show up to fix your gutters?

[Ksyrup]

The "wind-driven rain" issue has been going on for years. I was dealing with it as a Florida DOI attorney in the mid-late 90s and it hasn't gotten any easier since then. In fact, Florida's state-run "insurer of last resort" (Citizens) was created as an insurer for wind policies that the free market wouldn't sell on the coast anymore. And then you throw on top of the standard dwelling and contents vs. wind issue the separate flood coverage as well, and it's fairly easy to see how confusing it is for people to understand what they are and are not covered for.

[Eaglesfan27]

Will this make home insurance in the gulf completely unaffordable? I'm glad that these victims are compensated, but if I'm an insurance company, why do I want to go anywhere near that area ever again, if I seemingly have a "beyond a reasonable doubt" standard I have to meet when trying to prove water v. wind?


Even before this decision, most of the major insurance companies were refusing to offer new policies to anyone in the gulf coast region. As a result, I had almost no choice when we bought our home - I had to go with Farmer's Insurance. However, I got a reasonable price on a good amount of coverage and I was shocked how affordable flood insurance was (but then again I'm 60 miles from New Orleans and in an area that is graded as being very unlikely to ever flood.)

[Ksyrup]

I doubt a state would try it again, but in Florida after Andrew in 1992, the state declared a moratorium and refused to allow insurers to pull out of the state - essentially forcing them to insure their policyholders (with limited ability to non-renew existing policies each year). I was part of the appellate team that successfully defended the laws from a variety of constitutional challenges in Federal court, but I'm not sure how well something like that would go over with the courts again.

As you might expect, Florida is leading the call for a regional or national catastrophe fund to assist with such disasters. Within the state, they are also looking at a variety of mechanisms to hold insurer's feet to the fire, such as forcing them to get rid of their Florida-specific subsidiaries (essentially bringing the entire nation into play to help offset the cost of doing business in Florida) and not allowing companies to write other lines of P&C business, such as auto, if they don't write homeowners.

Although I'm no longer a resident of Florida, I'm following this closely because I still do a good deal of work in the regulatory arena in Florida.

[Flasch186]

Jon:

I honestly believe that there is a percentage of you that sees the other side and agrees but either, honestly or to be consistent, you continuously in multiple threads give the "big guy" a pass whether their behaviour is reprehensible to over 50% of the populace or not. why is that?

[JonInMiddleGA]

Jon:

I honestly believe that there is a percentage of you that sees the other side and agrees but either, honestly or to be consistent, you continuously in multiple threads give the "big guy" a pass whether their behaviour is reprehensible to over 50% of the populace or not. why is that?

You'd be wrong on that.

The part of this particular subject that I'm so adamant about is that I see nothing reasonable about this entitlement attitude which wants to require companies to either pay for stuff they didn't insure (and were not themselves paid to insure) or require them to offer a particular type of coverage.

Truth is Flasch that, although they're often several million times the size of my own little company, I feel a lot more kinship to them than I do to people who increasingly simply want the world to give them something for nothing and/or to give them something they weren't willing to pay for.

Again, specifically to this subject, if an insurance company tries to go against the terms of their agreement with a customer & simply refuses to pay in spite of a contractual obligation to do so, then that's wrong & they should be required to pay as specified. But that specific point is not what this thread turned into being about nor is it what my comments related to.

[Flasch186]

but what about cloudy language, which is quite common and evident as pointed out by Vin? Isnt it worse that they commonly use this ambiguous language as a tool to their advantage? Weve crossed this bridge befor ein other threads and I dont want to kid myself into thinking that you and those who agree with you are going to change your stripes, but i still subscribe to the idea that there is right and wrong and business is not above these ideas.

[Tigercat]

Not just cloudy language. Again, take the fact that insurance companies sold content protection in the gulf states to houses who's only likely internal damage would be as a result of a hurricane. Protection sold as "Well if a hurricane bears down on you, your contents will be protected." Afterall, flood insurance doesn't cover contents. And then when the storm comes they will do whatever it takes not to pay up.

If the surge hit first, they got you on the contract language, even though they sold you on the protection of your contents from a hurricane encounter. You suffer because you didn't think of every eventuality in advance, including the fact that waves driven by wind is considered flood. So they hold you to the contract, but what happens if it was clearly the wind that damaged your house more/first? They pass the buck, blame the flood waters because they can. They have done it nearly everywhere along the gulf coast.

So the Insurance companies have more lawyers, more engineers, and the luxury of time on their side. What do the people who lost more than these insurance companies will ever lose have on their side? Maybe the courts, when they finally get to your individual case. The insurance companies if they play their cards right can win anytime they want. They can win if the damages should be covered under the contracts, they can win if they shouldn't be.

On one hand I can understand where you are coming from Jon. But believe me, the freakin insurance companies don't need you on their side, they have plenty else on their side as it is.