Homeowners still recovering from the financial impact of Superstorm Sandy continue to fight to obtain the benefits for which they paid premiums even though several years have passed. A number of recent court decisions have exposed what appears to be a systemic practice of fabricating and hiding engineering expert reports and supporting documents to cheat homeowners with claims filed against their National Flood Insurance Write Your Own (WYO) policies. The adverse impact on policyholders has been even more harmful because FEMA, which oversees the National Flood Insurance Program, appears to have been complicit in the fraud. FEMA has provided motivation for the WYO insurance carriers to engage in bad faith practices and discovery violations during litigation by punishing insurance companies for “overpaying” claims.” These perverse incentives have motivated insurers to tenaciously dispute flood damage claims.
Raimey Court Exposes Manipulation of Engineering Reports
While judges in a number of states have focused attention on the practice of falsifying and burying engineering reports and related documents, the case of Raimey v. Wright Nat’l Flood Ins. Co. (In re Hurricane Sandy Cases) provides the most compelling example of a judge calling out this type of unethical practice. U.S. Magistrate Gary R. Brown characterized the conduct of U.S. Forensic, a professional engineering firm, as “reprehensible” and potentially widespread “gamesmanship.” The engineer in the case conducted an inspection of the property and took photographs that were included in the engineer’s initial report. The conclusion of the report was that the damage to the property was too extensive for repairs. The report specifically indicated that the damage was caused by “hydrodynamic forces” related to Superstorm Sandy and that the loss was so significant that repair was “not economically viable.”
However, this report was then revised based on what was referred to as a “peer review” by another engineer from the same engineering firm. While the first report was based on an actual inspection of the property, the subsequent report was based exclusively on photos taken by U.S. Forensic’s first expert. The insurer then denied coverage based on the revised report. When the policyholder filed a lawsuit and sought discovery of expert reports and supporting documents, the insurer produced only the second report and made no reference to the initial report or any of the communications or drafts related to the initial engineering report. The judge characterized the non-disclosure as particularly “reprehensible” because the court repeatedly directed the insurer to provide any and all reports and related materials, including “drafts, redlines, markups, reports, notes, measurements, photographs and written communications.”
Because it appears that some insurance companies are using select engineering companies to engage in dishonest practices in a multitude of cases, policyholders can benefit significantly from seeking out the expertise of an experienced insurance claims lawyer. Policyholders that lack familiarity with sharp insurance company practices risk being cheated despite the merits of their claims. If you have questions about Florida property insurance claims, you are welcome to contact my Miami insurance claims dispute law firm. 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 consultations and case evaluations with an experienced Miami insurance claims attorney. No Recovery, No Lawyer Fees. Call 305-461-1095 or Toll Free 1-866-71-CLAIM.