Think You Have Homeowners’ Coverage Because You Have a Certificate of Insurance: Think Again!

J.P. Gonzalez-Sirgo
Founder of J.P. Gonzalez-Sirgo, P.A.

There are many issues that can present problems to homeowners regarding their homeowners’ insurance coverage, but an issue that many policyholders never consider is whether they really even have an insurance policy.  Many people have nothing more than basic information and a certificate of insurance that they think is sufficient proof that their insurance policy is in effect.  The knowledge that a certificate of insurance is not adequate proof of coverage can come at a very inopportune time if you must file a claim.

According to the California Department of Insurance, an insurance agent in that state recently engaged in fraud, which placed a number of policyholders in an extremely precarious position.  The new release indicated that the agent was collecting premiums from homeowners, but was not actually purchasing insurance policies.  The insurance agent has been taken into custody and will face charges for violating his fiduciary duty toward customers.  He essentially committed fraud by accepting money under the guise of purchasing policies and paying premiums while pocketing the money.  Shockingly, the agent was able to carry on this ruse for years with respect to certain customers.

The scheme was accomplished by providing homeowners with bogus certificates of insurance and allegedly submitting premiums from customers to the insurer.  The certificates even had false policy numbers, policy limits and coverage periods.  These policyholders accepted the certificates as evidence that they were covered even though they were apparently never provided with an actual policy.

While most insurance agents would never engage in this type of fraud, the California Department of Insurance offers a number of suggestions that can protect policyholders from this type of fraud, which also constitute valuable tips for Florida homeowners:

  • Understand that insurance companies pay claims not insurance agents
  • Confirm that the agent you are working with has a valid license and is in good standing
  • Consider a request from the agent that you pay your premium in cash a fed flag
  • Request copies of your policy, receipts and any other documents
  • Pay premiums with checks payable to the insurance company not the insurance agent

If you suspect that your agent is engaged in fraud, misrepresentation or other unethical practices, you should consider contacting the Florida Office of Insurance Regulation.  The important takeaway from this incident is that you should always confirm that you have a copy of your actual insurance policy and know where it is located.  A certificate of insurance should never be accepted as proof of coverage because it will not be considered proof that you purchased a policy when you need to make a claim.

If you have questions or concerns about your agent or coverage, you should consider speaking to an experienced Florida insurance attorney.  My law firm represents policyholders in claims disputes in Miami and throughout Florida.  The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free case evaluations.  No Recovery, No Lawyer Fees.  Call 305-461-1095 or Toll Free 1-866-71-CLAIM.

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