Action 9 exposed an insurance nightmare facing hundreds of customers who paid one of Florida’s biggest insurers to protect their homes.
The kitchen's gutted walls are cut open, and the floors have been stripped. That’s the condition of Adrienne Herrell's home one year after a water leak triggered a destructive flood.
“I'm 75 years old and I've been homeless for a year,” said Herrell.
“Because of the insurance company?” asked Acion 9's Todd Ulrich.
“Because of the insurance company,” Herrell reiterated. She said Universal Property and Casualty offered $10,000 to cover losses, and then a public adjuster estimated repair costs at $110,000, so Herrell requested state mediation.
“Did both sides agree to a settlement?” asked Ulrich.
“We did. We signed,” said Herrell.
She can't disclose the amount, but more than 60 days later, she called Action 9 because Universal Property still had not paid.
“I'm praying a lot. I've turned to the lord because I can't deal with it," she said.
Watch: What you should know about insurance claims
After Hurricane Matthew ripped the solar panels off Gary and Annette Moskop’s Oviedo home, they too had a run-in with Universal Property and Casualty.
“Was it a slap in the face?” asked Ulrich.
“Oh, yes. Immediately,” said Gary Moskop.
The couple said a messy mediation with the company stuck them with a huge repair bill.
“And how do you treat people like that? We've been with them for years,” said Moskop.
Action 9 checked state records. In six months, 920 customers complained to the Department of Financial Services.
That's a 300 percent increase from a year ago.
Many had hurricane damage.
Four years ago, state regulators fined Universal Property for violations including delayed payments for approved claims. It paid nearly $1.3 million and agreed to change business practices.
The Department of Financial Services said its aware of the influx of complaints and sent its concern to the Office of Insurance Regulation.
“They need to understand this affects people's lives,” said Herrell.
Universal Property and Casualty told Ulrich the current market makes claims challenging to resolve, and Hurricane Matthew generated a 50 percent increase in claims.
Universal sent Adrienne Herrell her check several days after Todd Ulrich contacted the state.
The company said it's paying valid claims faster and says it has requested mediation more to speed up disputes.
Consumers can challenge mediation with a lawsuit but run the risk of attorney fees, and no payment.
Universal Property and Casualty response:
In recent years, UPCIC has significantly increased the personnel and resources of its claims department. As a result, UPCIC is able to adjust and pay valid claims faster now than at any point in the past. This point should not be lost in the discussion of any individual claim, nor during a period in which Florida law allows vendors and policyholder representatives to create delays and increase the costs of property insurance claims.
With respect to Ms. Herrell’s specific claim, we are pleased that the claim has come to a close. We note that privacy regulations and UPCIC’s business practices preclude us from commenting on individual policyholders’ circumstances. Unfortunately, the nature of the process sometimes allows policyholders or their representatives to make statements with which we do not agree, but we nonetheless do not believe it would be appropriate for the company to publicly address specific aspects of a claim.
As you know, the Florida market has seen an increase in recent years in claims involving assignments of benefits, public adjusters or other policyholder representatives. These types of claims have been well documented by representatives of the Office of Insurance Regulation, Citizens Property Insurance Corporation and others. These types of claims result in increased time and expense in the adjusting process. Even so, it is important to remember these types of claims comprise only a subset of the claims an insurer processes every day. In this regard, we believe the claims process should be viewed in the following context:
Meritorious Claims are Being Adjusted and Paid Faster Than Ever— UPCIC has significantly expanded its in-house claims department, resulting in faster average claims payments for policyholder. The increased efficiency in handling claims applies to not only day-to-day claims but also to catastrophe claims. UPCIC adjusted and paid claims from last year’s hurricane much faster than the industry average according to data tracked by the Office of Insurance Regulation.
Certain Types of Claims Continue to Present Challenges in the Florida Market— As has been widely discussed, claims involving assignments of benefits, public adjusters and/or loss consultants present unique challenges that add to the time and expense reaching resolutions. These claims are characterized by more adversarial proceedings, lengthier times to settle, and increased costs for the insurance-buying public. These types of claims attract the most attention but should not overshadow an insurer’s broader efforts to promptly and fairly resolve its meritorious claims.
Public Policy in Florida Favors Mediation as an Efficient Method of Resolving Claims— With the increase in questionable or contentious claims in the current market, it is no surprise that UPCIC has seen an increase in the number of mediated claims. In fact, UPCIC requests the mediation in a majority of the cases. The Florida legislature created the mediation process as an alternative to litigation available to both the insurer and the policyholder. The same parties who profit from creating contentious claims also resist going to mediation. However, mediations are effective— the parties reach impasse in only 1/4 of the cases.
Service Request are in Similar Proportion to Prior Periods— Despite the increase in questionable or inflated claims, the number of service requests UPCIC has received this year is proportionately similar to prior years, taking into account the number of policies the company writes and the number of claims reported.
Mediation Requests Should Not Be Equated to Consumer Complaints— We do not agree with a characterization of mediation requests as complaints. In most cases, UPCIC requests the mediations to provide a forum for resolving claims and to ensure that policyholders are involved in the discussions. Ironically, policyholder representatives often are the parties who resist going to mediation, especially if they have failed to inform their clients of the benefits of mediation. Purported “complaints” about participating in a statutorily-created forum often are as contrived as the claims in which they occur.
Cox Media Group