The answer to this question is – in Florida they don’t care.
The Insurance Journal reported that Florida’s Office of Insurance Regulation (OIR) approved a new roof coverage approval in Florida OIR approves roof approvals that could prevent non-storm claims. The endorsement reduces coverage and provides more reasons to deny otherwise legitimate roof damage.
The alleged reason for the approval was to “combat insurance fraud”. The article quoted me as questioning the basis for the approval:
A plaintiff’s attorney argued that Florida OIR should have challenged the approval because it will unfairly undercut legitimate claims.
“The insurance regulator should have asked for examples of how this language fights insurance fraud,”
; said Chip Merlin, a Tampa attorney who represents the policyholders. “In fact, a good regulator would go back and ask both insurers about these examples of how, without this language, fraudsters could get cap claims paid.”Hail may not show significant impact on shingles until later, after the initial damage loosens granules and exposes the material to deterioration, he said. “Most engineers, even those hired by insurance companies, will say that this gradual loss is significant physical loss. However, insurance companies will point to the policy language to deny the claim,” says Merlin.
In the long run, the recommendations may see relatively few challenges in court, thanks to Senate Bill 2A, which passed in December, and House Bill 837, which passed in March. Both of these make it more difficult for policyholders to hire plaintiffs’ attorneys, Merlin said.
“Because the Florida Legislature just eliminated policyholders’ ability to recover the cost of attorneys’ fees, and the average cap replacement is $25,000 to $30,000, wrongful denials of otherwise valid and payable claims will go unchallenged because people can’t afford to hire lawyers and engineers to fight for cover, Merlin said.
A response to an insurance agent’s comment on the article correctly stated:
The premium you pay is based on the materials on your property. If you have a tile roof, the carrier has run algon to see what the likelihood is that you have a claim and how much they might have to pay in that case.
This means that if you have a damaged tile roof due to a covered cause of loss, the carrier would have to pay you to replace the tile roof that they insured.
What you are proposing is akin to driving a Ferrari, paying insurance for it, it adds up and your insurance company pays you for a Kia. Makes no logical sense.
By the way, carriers are also pulling out of California. Not nearly as much litigation there as here based on the statistics, so what gives? Natural disasters affect their results. Well, don’t get into insurance then if you don’t want your bottom line to be affected when you’ve agreed with your clients to pay out.
Every consumer in the state loses rights and gets nothing in return but increased premiums for significantly less coverage. Oh, and the carriers still aren’t paying. Just check the statistics on how many open, denied and underpaid Hurricane Ian claims remain. Actually, why don’t you check to see how many victims of Hurricane Michael are still living in trailers on their properties because their houses were total losses and the carriers still haven’t paid them. It’s a joke.
Perhaps our insurance regulators analyzing the proposed wording of policy forms should study Bill Wilson’s book, When Words Collide: Resolving Insurance Coverage and Claims Disputesand remember this case quote from it:
“It seems that insurance companies generally try to convince the customer when they sell the policy that everything is covered and convince the court when a claim is made that nothing is covered. The miracle of it all is that the English language can be subjected to such abuse and still remain a communication instrument.
But until the courts generally tire of the task we have just experienced and strike down the whole practice, we feel we must run with the pack and try to interpret what may well be impossible to build.’ Universal Underwriters Insurance Company v. Travelers Insurance Co.451 SW 2d 616, 622-23 (Ky. Ct. App. 1970)
We need better efforts from our Florida insurance regulators. Let’s hope they get the message.
Today’s thought
Strength and growth come only through continuous effort and struggle.
– Napoleon Hill
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