This blog has on more than a few occasions published articles regarding negative experiences endured by policyholders pursuing claims against Citizens Property Insurance Corp, Florida’s property insurer of last resort. However, this post addresses welcome news regarding Citizen’s sinkhole claims. The quasi-public insurer recently released data indicating that it has settled 70 percent of sinkhole claims in 2014. According to a recent report in the Insurance Journal, Citizens settled 1,650 sinkhole claims that were the subject of pending litigation during the specified one year period. While many people are hesitant to retain counsel and initiate litigation against their insurer to resolve a claims dispute, this settlement demonstrates how legal representation against an insurer can increase the probability that a claim gets favorably resolved.
Citizens entered into settlement agreements under which the insurer agreed to accept a neutral evaluator’s findings in terms of the appropriate repair method. More specifically, the insurer agreed to abide by the evaluator’s recommendations regarding both underground remediation and above ground repairs. The insurer also agreed to pay the law firm’s representing policyholders a preset fee. For policyholders with claims still pending, Citizens agreed to extend the settlement offer to other insureds who agree to settle litigation of their sinkhole claim and to commence repairs.
Citizens created a sinkhole repair program to manage the repair process. The insurer contends the purpose of the program is to match its insureds with contractors that have a proven record of competence and the financial resources to protect homeowner’s from substandard workmanship. The process for policyholders to get their home repaired involves choosing a contractor or company from a group of businesses designated by the insurance company. The contractors on the approved list perform the underground remediation work that is required to stabilize the home. The claim is paid out as the repairs are performed by the company contracted to undertake the repair work. An insured can also select any contractor indicated in the settlement to perform above ground repair work.
The settlement is welcome relief for homeowners that have struggled with sinkhole claims since a 2011 change in Florida law that pandered to the insurance industry. The law set standards for structural damage that made it difficult for a loss to qualify for coverage unless it constituted a catastrophic collapse. The law also stacks the deck against policyholders by authorizing the carrier to select the engineering firm that will determine if the standard is met. The pro-insurance modification of Florida sinkhole insurance law also excludes coverage for cabanas, patios, and driveways. Because policyholders are required to purchase coverage separate from the standard homeowner’s policy, the insurance industry also has used the law to drive up rates for sinkhole coverage. An article in the Tampa Bay Times reported that Citizens increased the average premium for sinkhole coverage between 2011 and 2014 from $1,449 to $2,105 in Pasco County and from $1,105 to $1,955 in Hernando County.
If you home has been damaged by sinkhole activity, we invite you to contact us to speak to an experienced Florida homeowner’s insurance attorney. Our Miami insurance claims firm invites you to contact us if you are having difficulties with your insurance company. Florida insurance claims lawyer J.P. Gonzalez-Sirgo handles claims against insurance companies in Miami and throughout Florida. The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations. No Recovery, No Lawyer Fees. Call 305-461-1095 or Toll Free 1-866-71-CLAIM.