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I am an insurance guy but it sure does sound like cherry picking. All was well until a big one hit, then State Farm is splitting. They are in the risk business and storms can happen if you write in those areas. Take the good with the bad boys and girls.
State Farm may have legal points to make regarding their policy language and the flood exclusion. The fallacy is that State Farm offers protection to folks and they call it a homeowners policy. Houses were destroyed by a hurricane, so now State Farm says that technically we don\’t have to pay because water came with the wind. They may win this legally but State Farm and the insurance industry will be held in disrepute for a long time.
Sometimes corporate officers must make decisions based upon the context of what is best for their industry and for society as a whole. They refuse to do that and consider the whole concept of social responsibility to be just an add campaign.
Hats off and congratulations to AG Hood for a job well done. Hopefully other states will follow his example. Here is man who I thought was in on the corruption, only to find that he has an honest and ethical soul and is taking a fair approach to the problem.
I am not an insurance person but read law,consumer rights and specifically how insurers and policyholders behave during a catastrophy. I am also a restoration contractor. I was living in Oak Grove MS in the first part of 06 and reading an article in the Hattiesburg one day. The Gov asked the insurance commisioner for the number of disputed claims and the Dale stated he was not obligated to do that. It stunk of backwater politics and corruption.I also witnessed hundreds of FEMA tarps in the area and homeowners with insurance estimates in hand,a new SUV or a big screen TV they didnt own before the storm remarking they were going to get charity and benevolence groups to fix their roof or home. AN OVERHAUL on both sides of the fence needs done
This is not cherry picking, it\’s not breaking promises or doing anything immoral or illegal on the part of State Farm. This entire story is about the attorney general trying to lay the foundation for his next state-wide office. So, he\’s using State Farm to buy votes by trying to force State Farm to cover things that are clearly not covered. It\’s horrible that these people lost their houses from flooding, but they should have had flood insurance. It\’s not State Farm\’s fault they didn\’t have that foresight. Trying to get State Farm to pay for it at this point has no justification.
If State Farm is such a robber baron why is Hood attempting to force them into writing more business?
Hood is a bungling fool!
Why didn\’t these people carry flood insurance? I guess those that were too cheap to buy it now want the other policyholders of State Farm to pick up the tab for them. I\’m a State Farm policy holder and I say NO! There is such a thing of being responsible for ones actions. If they did not buy flood insurance then they should pay the water damage themselves.
It\’s amazing to me that people forget what type of person a politician is. Most all are known charlatan\’s. In this case Hood conveniently ignores the fact that State Farm is owned by it\’s policyholders. Any action against this company is actually taken against the very people he represents. I\’m sure he knows this and realizes the citizens of Mississippi don\’t.
Do you work for State Fare?
We Robber Who? Do you work for State Farm
Try to put Katrina out of your thoughts…..
Now, as CEO of your own company, doing business in a state that is historically NOT a friendly place to do business (even without wind storms)and you have 30% of the available business. How much more do you want to take????
In the insurance business a penetration of 30% in any market or for any type of insurance is considered HUGE. If SF doesn\’t write another stick of new property business in the state and renews what it already has, they will continue to be the largest writer for years to come.
What is the advantage of taking on more risk in a state that is subject to cat wind loss and a liberal court system?? I think the answer is \’None\’.
I like Oldsmobiles but GM chose to stop making them because there were not profitable. As long as Mr. Hood wants to tell companies to do business even when it isn\’t best for business, I wonder if he could stop GM from selling any profitable lines or cherry picking in Mississippi unitl they bring back the Oldsmobile line. I would also like a major airline to land in my town but they say it is to small. I don\’t think they should get to cherry pick either. However, I accept both of the above as good business practices not poor consumer policy. When businesses are forced to do what is good for the few at the expense of many it is poor policy. State Farm didn\’t just pack their bags and leave they are still taking care of 30% of the current homeowners in Mississippi. They just don\’t want to take on new business or further expose their current customer\’s until they know what the outcome of the court decisions in that state will be. I see no fault in a business wanting to protect all of it\’s current customer\’s in bad legal and political enviroment. If you think what Hood has planned is great you might want to look at Florida and the mess they are in. Mississippi should learn from Florida so they don\’t end up in such a big mess. Currently in Florida the State is the larges writer of new home, church and business insurance policies in the state. Most of the insurance companies that are left are shut down or have very limited capacity. The state, as an insurer, is doing such a good job in Florida they ran out of money in 2004 and 2005. So they let the state insurer tax all insured\’s with a home,church and business policy in Florida. The tax, which they call an assessment, was 6.8% of consumers 2006 total insurance premium for the states 2004 losses and 12% over the next ten years for the 2005 losses. This year they expanded the taxing authority of the State so they can assess your auto premium up to 10% as well. They must be pretty sure that the state run insurance company will fail again or they wouldn\’t have expanded the assessment to include auto premium. These taxes were on top of increases many customers had to pay for their own insurance policy some as high as 200% increases. It also doesn\’t matter what part of the state you live in, you paid the tax. So, if you support what Hood and the courts are doing in Mississippi, you can expect an insurance industry like that in Florida sooner than you want it. It sounds great to hear that an insurance company was punished until you realize you will be paying the bill. Hood wants to follow Florida\’s lead now and force auto carriers that write home insurance in other state to write it in Mississippi. If they don\’t they will have to stop writing auto insurance in the State. So far Florida doesn\’t know how many companies will leave the auto insurance market there because of this new law. Profit margins are not great in the auto market so if you must loose money on home insurance to write auto insurance will they stay? That is the questions that is yet to be answered. If you loose more on home insurance than you make on auto insurnce they will leave. Hood wants to follow the blind and put the consumers in Mississippi at risk. Wake up Hood you should be using dialog to work on a solution not pick a fight that leaves everyone hurt.
It would be irresponsible for State Farm to write more business even if there would be no political problem. What exposes Hood as incompetent is the fact that he should understand this, and if he does understand, what a stupid way to solve this problem. However, politicians will be politicians. Power is the most important thing to them. The great feeling of ego when walking down a street and everyone looking and saying \”there goes Hood\”. This is what these guys live for. Not all politicians are this way, but unfortunately most. As a contributor to the Republican Party I always though Haley was a good honest man and would tell it straight regardless of the policical consequences. I\’m from PA and have not been following Haley\’s statements, what have they been?
Has a lot more to do with the legal environment, than a cherry picking of risk. Hood has declared that insurance contracts are no longer valid in MS. Doesn\’t matter what policy you bought, or the carrier sold you, apparently you are just automatically ocvered for any and all losses. Why bother buying flood covg, when you can just stick your homeowner\’s to cover it. Maybe auto covg should also have to cover flood losses.
MS is doing this to themselves. They want to steal from the carriers, and then actually expect the carriers to be happy about it, and set themselves up for another debacle next time.
The whole situation started with State Farm and its denial of all these claims. State Farm is getting blamed for the trouble it caused to itself. You can pick on Mississippi all you want but justice does find a way.
Maybe they got denied, because the policy clearly excludes flood, and most of theses people are trying to have their policy covering something they were either too dumb or too cheap to purchase.
A policy is a contract, and if the courts won\’t enforce them, then it would be ridiculous to continue to sell those policies.
wow, those are big words for Jim Hood; robber and baron both have two syllables. Congratulations, Jim! Now, lets see if he can use those two complicated words in an intelligent sentence; c\’mon, Jim…you can do it. We will wait with baited breath…
Dean,
Another Rick has it right. 30% market share is a lot for one company to take on.
Just how much business should State Farm be \”required\” to write per Mr. Hood? Are they going to be required to take all business that walks in the door?
Is Hood\’s legislation going to apply to all insurance companies? Leave it to a politicaly motivated Attorney General to screw up the insurance market in MS.
I\’ll say it again…
The government (politicians) only care about taxes and votes. They don\’t give a crap about you!
So Hood wants to mandate that a Mutual company, owned by policyholders, must continue to write new business in a state
where they already have 50% more market share than they want. State Farm currently insures about 20% of the market
nationwide, so in Mississippi they are carrying more risk (30%) than in probably any other state. Do I think Hood cares about State Farm agents income? Hell no.
And there is a reason State Farm has such a big share there – could it be that they
are reasonably priced and have a history
of providing good service? Usually that is why a company has a majority market share. And no, I am not a shill for State Farm.
February 14th, 2007
By Larry Lubell
Urban Insurance Blog
________________________________________
State Farm Insurance Company anounced that it. is suspending sales of any new commercial or homeowner policies in Mississippi starting Friday. A company official said that the wave of litigation it has faced since Hurricane Katrina, was the main reason.
Mississippi’s “current legal and political environment is simply untenable. We’re just not in a position to accept any additional risk in this homeowners’ market.” said Mike Fernandez, vice president of public affairs for State Farm
State Farm has argued that their homeowner policies were worded to cover damage from wind but not from water – even if hurricane-force winds were the cause of the rising water. They also state that their policies exclude damage that could have been caused by a combination of both wind and water.
Hundreds of State Farm policyholders have challenged that claim, saying they were “Sold” Hurricane policies and storm surge is a part of a hurricane, and they are therefore entitled to Compensation.
In the case of Norman and Genevieve Broussard VS State Farm a jury awarded the Broussard’s $2.5 million in punitive damages against State Farm for refusing to cover Hurricane Katrina storm surge damage to their Biloxi home.
U.S. District Judge L.T. Senter Jr. later reduced the award to $1 million, even though the judge found that State Farm acted in a “grossly negligent way” by denying the claim filed by policyholders.
Last month Attorney General Jim Hood reached a settlement with State Farm requiring them to pay about $80 million to more than 600 policyholders who sued the company for refusing to cover damage caused by Katrina. Judge Senter later refused to sign off on part of the agreement, a deal between State Farm and Mississippi
I have excellent creditability. I have been a competitor of theirs for 48 years!
I know the honesty and quality of insurance industry management vs the honesty and quality of those in politics and government. I would always trust those in insurance over politicians and government bureaucrats.
I am a former SF employee and have served my share of storms. After reading all these posts, I have 2 thoughts: 1) no one got flood insurance because they never dreamed a storm surge that high would hit. Even some SF agents themselves did not carry flood insurance because they were not in the plain. 2) Our govt at ALL levels was totally unprepared for this storm and that is really why Hood is wigging out right now. Puttins aside the whole \”should it be covered\” argument for a second, who provided the best response to this disaster in general? The private sector! Red Cross, insurance companies, even Walmart reacted quicker and more efficient than our govt officials. So now SF is going to stop writing more insurance and that means the burden will fall on a still overwhelmed and unprepared govt, Hood and the rest of them are probably having panic attacks every day the new hurricane season moves closer.
Just curious…
Is the phrase \”whether or not driven by wind\” seen to be a modifier of each of the perils listed: \”Flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these\”, or just the last? I believe it may be only the spray that that phrase applies to.
My point is that if that phrase is not seen to reach back to, say, \”overflow of a body of water\”, then it might be construed that that peril would only be excluded if NOT driven by wind (a covered peril).
Re: AG Hood, I think he is nearsighted in not understanding the economic consequences of his proposed ruling. SF might just pick up ALL its marbles and leave.
Rick,
Point well taken.
I will try to keep my posts more \”Conversational,\” and directly connected to the article
Sorry
Larry
LIKE A GOOD NEIGHBOR STATE FARM IS/WAS THERE.
Look if you want to do business in a state where as most don\’t even have insurance than you need to pay for your claims. Rev. Hood is a good man for looking after the little people who couldn\’t afford no flood insurance. He\’s a gonna teach you companies to do what\’s right for Mississippi and his re-election too.
Woohoo!
So all the State Farm agents get to keep their renewal business and start accepting independant agent appointments now???
I say let State Farm shoot themselves in the foot if they want. There 30% would be better served spread accross many carriers anyway.
State Farm\’s flood exclusion reads as does all others. where their wording differs is that it also says that if there is first damage by wind, then flooding (per the definition) that would have also done damage, then the wind damage isn\’t covered.
Yet it is a well established principle of insurance, and it is the way all other insurers policies read, that the wind damage would be covered even if the flood would have later caused that same damage.
That was the basis of the lawsuit and punitive damages they just lost.
It is despicable for them to put such language in their policy.
What is also amazing, and was not a factor in the lawsuit, is that the State Department Of Insurance APPROVED that language. They must approve all language in every single insurance policy written in the state. How that got by them, I don\’t know except maybe not many people in Mississippi can read?
As an Independent Agent in Florida, we learned a long time ago the benefits of offering NFIP flood coverage to our clients. Unfortunately, there are many agents across the country who only write the coverage when the lender requires it.
This isn\’t a SAT question, but when you live close to the coast in a B, C, or X flood zone and you\’re 6-8 feet above sea level, and there is a 20 ft storm surge, it isn\’t difficult to do the math.
Also, SF doesn\’t allow their agents to write excess flood coverage. And quite frankly, most of the SF agents I\’ve run across are \”order takers\” not agents.
Any property owner within a minium of two miles of the coast that does not have flood coverage is irresponsible. I do not agree with some of State Farm\’s actions but, property ownership has responsiblities and if you do not take those responsibilities seriously you may get bitten. I hate the damage that was done and the lives that were disrupted but that is what the opportunity to buy the proper insurance coverage is all about. Flood coverage would have taken care of all of these claims that the homeowners policies do not cover. We had a major flood not long ago and people that carried flood insurance were able to recover. Those that made the decision to not buy flood coverage had a major problem. The insurance company was not responsible for covering the damage for people that decided not to purchace coverage. You own it you protect it. You dont protect it you may lose it but the risk is yours to take.
Florida has over 2 million flood insurance policies in force. You have to add the next 11 states to equal the number of flood policies currently in effect in Florida. The Federal Government created the flood policy in 1968 because of the lack of coverage in a Homeowners policy. One would think that after 39 years someone would have explained that FLOOD OR RISING WATER IS NOT COVERED IN A HOMEOWNERS POLICY.
Very good article in today\’s WSJ (Opinion pg) about the likes of Hood and some of the other state AG\’s emboldened by the successes of Hurricane Spitzer. Maybe his new name should be Robin Hood.
These guys/idiots/junior spitzers in Mississippi better understand the results of their actions. I hope State Farm pulls out of there and teaches guys like Hood a lesson. Then the people of Mississippi will see what kind of boneheads they elected when the state ends up being a place where they will have trouble getting Home insurance, much less coastal insurance.
Yeah, like Charles Foti in Louisiana, trying the Doctor and two nurses for murder days after Katrina.
What a service these buffoons are creating for their states.
They deserve what they get.
The facts you state are well known. This is how the water exclusion reads in Pennsylvania (by all my companies – not State Farm) and please advise if State Farm\’s is different in Mississippi: EXCLUSION: WATER DAMAGE – Water damage means (1) Flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind.
OK Larry, now you will be picked up another time on a search engine.
Following the many catastrophes that occurred around the same time, no company had enough adjusters to take care of everyone who had a claim. In the major cat areas, adjusters were brought in from all over the country. No insurance company has an adequate number of adjusters and if they did then the policyholder would be paying much higher premiums to have them sit around and only go to work when a major catastrophe hit. In Florida, the State run insurance company (Citizens) took as long as a year to get to all the claims. They even ran out of money and had to assess all HO policyholders in the State to help pay claims. In case you didn\’t know, your premium doesn\’t just pay for the damage you suffer, it also pays for office space, computers, paper, phones, staff, adjusters including their travel and room and board. Agents are paid a commission to handle the application, photos of the property, phone calls, changes in coverage, etc. During the past decade, agents commissions have been decreasing. Florida even filed a bill in its Legislature to reduce agents commissions on a HO policy to $25.
Like I have said before. State Farm could take care of this very easily by requiring anyone in a coastal state or flood zone for noncoastal states to purchase a flood policy. Then every homeowner policy they have written would also have a flood policy to go with it. The company and its agents would make a lot of money off the additional commissions. If the state tells them they cannot require their constituents to purchase the coverage they need then I think the company has an obligation to the rest of their customers to leave those states completely. Also, State Farm is the biggest and if they start doing this the other companies will follow. I would like to see the politicians arguing that their constituents should not be forced to buy the coverage they need.
You Are a part of the Problem because you are an INSURANCE AGENT. Without Doubt!
You are covering for the Industry because you make a good living off of Your Clients.
It is fair to say that you would need the trust of a Homeowner, if you want their business but the truth is your loyalty is to the Insurer and not the Insured.
Have you ever heard of this saying,
Ignorance of Insured-Insurance Best Friend
Do you explain the benefits to the proposed insured or even try to explain ?
Do you explain the exclusions too?
Do you offer various Rates for
Optional Hurricane Deductibles in a policy that does not provide Hurricane Insurance?
How do you explain this to your Client?
A policy without coverage?
The Original Defination of Insurance is a sum of money that is paid to financially guarantee something of value.
The reason why the Industry is one of the largest in the USA.
We, the working Americans have put you up there, don\’t think we can\’t watch you fall down. We can replace you by becomming Self-Insured or allowing FEMA to sell disaster insurance.
Can you admit to calculating exclusions?
Can you admit to loopholes that are written into the policy to exclude coverage from the Insured but provide financial gain to the Insurer?
Can you admit that it is impossible to have a hurricane without wind & water in a coastal area?
Can you admit that Agents do not explain the policy to the Insured?
If they did, not one policy would be sold.
Can you admit that the purpose of the loopholes & policy exclusions are well calculated ways to prevent the Insured from collecting benefits?
Can You Admnit that the Insurer wants to collect premiums with Annual Rate Increases?
Can you admit the Insurer has calculated many ways to prevent providing financial protection to the Insured and they will usually force the Insured into litigation in order for them to collect what they paid you for in the first place?
Why did State Farm Settle in Misssissippi?
Were they hiding something?
Did they deceive their own?
Are they Innocent?
Did any one of their Agents even try to offer living expenses to their clients during the worst natural disaster in American History?
As far as I know, the only people that were schooled by their Agent were family/ friends of the Agent.
Did the Agent Follow Company Policy or did the Agent just avoid assisting their clients when strangers flew to our aide?
The Industry needs reform & regulation,
and that sir, is the truth!
Always Guaranteed, Annual Rate Increases
but Always find ways to deny claims.
State Farm was finally challenged by a hand full of Elected Politicians.
That was history and then they won.
State Farm Setteled. Why?
What were they afraid of?
Now they only want the cream of the crop but they don\’t want reform.
It\’s not about ego, it\’s about right & wrong. We are the American People, living in the USA. If you cannot provide fair policy go sell your policy in Iraq
where you will not be able to settle in or out of US COURTS.
Great not only is this poster (David Kim) dead but he is a total nutter!!!
THEY ARE IN THE LOBBY AND ON TV BUT THEY CERTAINLY WERE NOT THER FOR CLIENTS DURING OR AFTER KATRINA.
You\’ve said it all.
Like to see them wiggle out of this one.
They pee on our leg then try to tell us it is only rain.
The Party\’s Over.
We Pay Every Cent that we are supposed to pay and with A Guaranteed Annual Rate Increase; if we are short One Cent, they cancel our policy.
I understand they must have some exclusions, but the policy has more exclusions that covered benefits.
That is unfair and America needs to know.
Still State Farm, still showed a profit.
The Agents continued to profit.
The additional Adjusters that were hired were inexperienced but still profited,
the common demonator is they all
Followed Company Policy.
NOT ONE AGENT OFFERED ASSISTANCE TO THEIR KATRINA CLIENT AND THAT MY FRIEND IS NOT A GOOD NEIGHBOR, THAT IS PIRACY.
THEY SHOULD BE USED FOR ADVERTISING AS A GOOD NEIGHBOR BECAUSE THAT IN ITSELF IS A LIE.
FBIC Reports The Whole Story Covering Updates And News Breaks.
Spitzer\’s And Other Agency\’s Offices Have Only Looked Into Fraudulent Activities In The \’Sales\’ End Of Insurance
But Have Avoided The Criminally Intensive \’Claims\’ End Where It Is Very Well Known And No Secret That Widespread Fraud And Corruption Is Far More Rampant And Pervasive And Knows No Bounds … Where States Regulatory Agencies\’ Insurance Department Commissioners Have Intentionally Looked The Other Way Shirking Their Responsibilities To The American People And State Citizens For Decades.
In Another Area, The SEC (And DOJ) Has Limited Their Investigation Into Deceptive Finite Reinsurance Practices And Fraudulent Accounting Practices. Unfortunately, I understand more than you want me too.
Will The States Insurance Regulatory Authorities Continue To Have Exclusive Regulatory Authority Over The Insurance Industry?
Will Elected Officials & American Citizens Demand assistance from
the Government to Close Down the Lobby,
and Take Control of Industry has has
gone bad?
FBIC Reports The Whole Story Covering Updates And News Breaks. Spitzer\’s And Other Agency\’s Offices Have Only Looked Into Fraudulent Activities In The \’Sales\’ End Of Insurance But Have Avoided The Criminally Intensive \’Claims\’ End Where It Is Very Well Known And No Secret That Widespread Fraud And Corruption Is Far More Rampant And Pervasive And Knows No Bounds … Where States Regulatory Agencies\’ Insurance Department Commissioners Have Intentionally Looked The Other Way Shirking Their Responsibilities To The American People And State Citizens For Decades. In Another Area, The SEC (And DOJ) Has Limited Their Investigation Into Deceptive Finite Reinsurance Practices And Fraudulent Accounting Practices. Unfortunately, Much Much More Is Needed. Now What? Will The States Insurance Regulatory Authorities Continue To Have Exclusive Regulatory Authority Over The Insurance Industry Or Will The Federal Government Step In To Share Their Much Needed Oversight Over Our Country\’s Out Of Control Insurance Industry?
HEADLINE #2:
In some cases, State Farm\’s top leadership prefers not to share or even keep records that offer insight into how policyholder claims are handled, according to court records.
Chairman and CEO Edward B. Rust Jr. said in sworn testimony earlier this month that no minutes are kept of quarterly meetings held by the company\’s top management, the Chairman\’s Council, and that policyholders have no right to information about an investigation State Farm Insurance Cos. has ordered of its relationship with Haag Engineering Co.
State Farm spokesman Phil Supple said the company doesn\’t \”intend to—;try this—;case in the media.\”
\”State Farm stands by testimony given by President and Vice Chairman Vince Trosino, who said when asked about these allegations, \’It\’s not part of our system. It\’s not part of our core values. It\’s not what made us the most successful property and casualty insurer, life insurer, in the country.\’\”
Juries in two states, Texas and Oklahoma, have found Haag provided biased reports to State Farm to minimize or deny policyholder claims. Mississippi\’s attorney general currently is conducting a grand jury investigation to determine whether State Farm and other insurers denied Hurricane Katrina claims through the use of fraudulent engineering reports.
Haag denies bias, but State Farm suspended business with the company in June and ordered an independent investigation after an Oklahoma jury awarded a total of $13 million to a policyholder over tornado damages. Subsequent trials are set to determine damages for 70 other policyholders, all of whom had claims investigated by Haag.
In past court cases, judges have chastised and even fined State Farm for withholding records the company was ordered to produce. Evidence the company destroyed documents has been presented in several cases.
In the Oklahoma case, after State Farm finally turned over to the court a \”claims legal research\” DVD and other records, Judge Richard G. Van Dyck told company attorneys
\”As I was watching these tapes I just want to say this for the record, the hair on the back of my neck did — did stand up because I was seeing things there that early on in this case I was told by (State Farm) defense counsel didn\’t exist and couldn\’t be produced. So I\’m not real happy with that and I want to remind all counsel that their ethical responsibilities as attorneys outweigh the wishes of their clients.\”
Gary T. Fye, an expert in the analysis of disputed insurance claims who lives in Nevada, often testifies in insurance cases. Fye, who said he has testified on behalf of policyholders and insurance companies, has provided the courts information on State Farm\’s history of destroying and withholding records.
In 1998, Fye wrote in a Florida case
\”I have been witnessing document destruction, concealment, and obstruction of discovery by State Farm for many years in connection with my review of internal claim practices documents of the insurer. I have accumulated certain Exhibits which show the company\’s goals and objectives for document handling by its employees. The documents show close to 28 years of intentional destruction, concealment and distortion of claim practices records.\”
In some cases, company executives did not keep records.
Jeff Marr, the attorney suing State Farm in Oklahoma, took sworn testimony Sept. 6 from Rust. Topics included Rust\’s Chairman\’s Council, made up of top State Farm executives. The group, which includes the company\’s general counsel, meets quarterly.
Marr was fishing for records of those meetings that he could subpoena for his lawsuit.
\”Certainly,\” Marr asked Rust, \”you keep records of the quarterly meetings where the entire Chairman\’s Council is present?\”
\”We have an agenda,\” Rust said, \”but minutes in that, no.\”
\”Why not?\” Marr asked.
Rust replied, \”Never felt a need to.\”
Marr later asked, \”Are there any written agendas that are available should I choose to request them in the lawsuit?\”
\”I\’m not sure what might be available,\” Rust said.
Rust also said policyholders, who essentially own the private mutual company, are not entitled to know what the Chairman\’s Council discusses or decides about litigation against State Farm, citing attorney-client privilege.
Marr questioned why the company would withhold information from policyholders, who own State Farm.
\”Well, again,\” said Rust (who has a law degree), \”I\’m not an expert in the area, but I think as you find — even if I\’m a shareholder in a publicly traded company, there are things that are not — you know, I do not have access to.\”
Marr later asked if policyholders have a right to see documents from State Farm\’s investigation of Haag.
\”No,\” Rust said.
\”Why not?\” Marr asked. \”Is it privileged?\”
Rust said, \”I believe so.\”
(c) 2006, The Sun Herald (Biloxi, Miss.).
Subject Posted By Posted
recorded history, swept through Oklahoma in 1999, a jury has decided.
The verdict, announced late Thursday, delivered millions to the lead plaintiffs and could have repercussions in the Gulf Coast states, where residents allege State Farm acted in bad faith when using engineering firms to assess damages after Hurricane Katrina destroyed thousands of homes and businesses.
The jury in the District Court of Grady County, Oklahoma, awarded Donald and Bridget Watkins almost $13 million in total damages for their part in the class action suit against the nation\’s largest insurer. The Watkinses are the lead plaintiffs in the case.
Jeff Marr, who represents the 70 families in the class action, said he thought the insurance company underestimated Oklahomans\’ willingness \”to put an end to corporate arrogance.\”
\”They expected Oklahomans, just like their policy holders, to believe anything they told them,\” he said.
As many as 11,000 Oklahoma residents, who were covered by State Farm when the tornadoes struck in May 1999, could be eligible for damages, Marr said.
\”State Farm is disappointed with the Oklahoma verdict,\” said company spokesman Fraser Engerman, adding that it will appeal.
According to the lawsuit, State Farm hired Texas-based Haag Engineering, which intentionally undervalued damage to homes or claimed the damage was caused by other factors — like faulty construction — instead of tornadoes.
The jury ruled that State Farm \”recklessly disregarded\” its duty to deal fairly and act in good faith with the Watkinses and that it \”intentionally and with malice\” breached its duties as the couple\’s insurance company.
The jury further found \”clear and convincing evidence\” that State Farm recklessly disregarded its duty to act fairly and in good faith with members of the class action by employing Haag Engineering and its independent adjusters from E.A. Renfro Co. It also said State Farm acted intentionally and with malice in dealing with customers in the use of these two companies.
Neither Haag nor E.A. Renfro is a party to the lawsuit, but Haag issued a statement saying it \”strongly disagrees with the jury\’s verdict.\”
\”State Farm hired Haag Engineering because of its recognized expertise in assessing tornado damage,\” the statement said. \”State Farm made no attempt to influence the work of Haag\’s engineers and their analyses, and Haag\’s reports were based on objectively verifiable facts and sound engineering principles.\”
Haag is one of the engineering firms State Farm hired to assess damages in the Gulf after Katrina, Marr said.
Mississippi attorney Richard Scruggs has claimed State Farm hired engineering firms that claimed the damage to structures was caused by water and not wind, making State Farm not liable.
Marr said he plans to help attorneys representing Katrina victims prepare their cases against State Farm.
\”State Farm is using Haag in the Gulf to reduce the amount it pays on claims under the guise of giving these policyholders an objective assessment when it\’s a foregone conclusion on what the outcome will be,\” Marr said.
State Farm\’s Engerman said there is no relation between the Oklahoma cases and those in the Gulf.
\”The facts in the two situations are very different,\” he said. \”One involves damage by Oklahoma tornadoes of 1999. And the other involves damage caused by hurricane and flooding in Mississippi in 2005.\”
Haag\’s attorneys said it was \”too early to speculate on what impact, if any, the Oklahoma case would have
Subject Posted By Posted On
RE: tree sap transfer GED
:
I would like to respond to Mike\’s posting with some thoughts of my own.
The massive regulation of insurance companies by state insurance commissioners does little good when individual companies, with hundreds of attornies and billions of dollars in reserves that they can access for litigation in any state, will take whatever resources and means they can to keep little people with few resources from getting a fair settlement on their claims. Regulation and rate fixing does not prohibit companies from dragging out claims investigations, forcing people into a lengthy mediation processes and, in the end, just wearing them out so that they will take whatever offer is given to them in an effort to put the nightmare behind them.
Unfortunately, the free market system doesn\’t work as well after a catastophic loss has occurred. It would be nice to be able to change insurance companies after you have decided that the one that is refusing to settle your claim fairly is not dealing in good faith. The problem is that you can\’t run to another company and get them to pick up the claim where another leaves off. If you buy a car that is a lemon, at least you have some salvage value if you want to change products. Not so with insurance policies. You are stuck with trying to salvage whatever you can out of promises that lay people are generally unable to interpret without the help of an agent who they trusted at the time of purchase. What a surprise when at the time that your life is at its darkest, you find that the coverage that you have paid for for decades, and I mean literally decades, is going to be drug into litigation or mediation so that attornies can now take that \”easy to read\” policy and split each word and nuance into bits to save as many pennies as are possible.
Wouldn\’t it be so much easier if they just paid the $50,000 claims that are due, give the people the relief and help that they need and be the kind of blessings to ordinary people that they originally set out to be when the companies were formed. Instead, they use their staffs of hundreds of attornies to spend millions of dollars to avoid paying thousands. I know that this practice is being promoted as \”fairly analyzing the losses\” but in reality it is nothing more than a stall to get people to accept anything that they are offered so that they can get on with their lives and try to rebuild, even though they may end up in bankruptcy or deep depression.
You mention that AG Hood is forcing SF out of Mississippi. They are leaving on their own, because they do not want to take the chance of using future huge profits from the states that have not had huge loss ratios in to subsidise losses in MS. The law of large numbers ceases to work when you start diluting the exposure that created the megamillions that got you to be the number 1 casualty insurer in the nation. Just ask Mutual of Omaha. Once the greatest name in health insurance is nothing but a shadow of its previous self after withdrawing from the state of New York in an effort to fight legislation that demanded guaranteed issue coverage to all applicants. They too had reached a positon of dominance in their field, only to lose it when they started to limit their payments for profits sake.
Let just start by telling the truth, treating each other fairly and being satisfied with a job well done and stand up for what is right.
Melanie:
I would like to respond to Mike\’s posting with some thoughts of my own.
The massive regulation of insurance companies by state insurance commissioners does little good when individual companies, with hundreds of attornies and billions of dollars in reserves that they can access for litigation in any state, will take whatever resources and means they can to keep little people with few resources from getting a fair settlement on their claims. Regulation and rate fixing does not prohibit companies from dragging out claims investigations, forcing people into a lengthy mediation processes and, in the end, just wearing them out so that they will take whatever offer is given to them in an effort to put the nightmare behind them.
Unfortunately, the free market system doesn\’t work as well after a catastophic loss has occurred. It would be nice to be able to change insurance companies after you have decided that the one that is refusing to settle your claim fairly is not dealing in good faith. The problem is that you can\’t run to another company and get them to pick up the claim where another leaves off. If you buy a car that is a lemon, at least you have some salvage value if you want to change products. Not so with insurance policies. You are stuck with trying to salvage whatever you can out of promises that lay people are generally unable to interpret without the help of an agent who they trusted at the time of purchase. What a surprise when at the time that your life is at its darkest, you find that the coverage that you have paid for for decades, and I mean literally decades, is going to be drug into litigation or mediation so that attornies can now take that \”easy to read\” policy and split each word and nuance into bits to save as many pennies as are possible.
Wouldn\’t it be so much easier if they just paid the $50,000 claims that are due, give the people the relief and help that they need and be the kind of blessings to ordinary people that they originally set out to be when the companies were formed. Instead, they use their staffs of hundreds of attornies to spend millions of dollars to avoid paying thousands. I know that this practice is being promoted as \”fairly analyzing the losses\” but in reality it is nothing more than a stall to get people to accept anything that they are offered so that they can get on with their lives and try to rebuild, even though they may end up in bankruptcy or deep depression.
You mention that AG Hood is forcing SF out of Mississippi. They are leaving on their own, because they do not want to take the chance of using future huge profits from the states that have not had huge loss ratios in to subsidise losses in MS. The law of large numbers ceases to work when you start diluting the exposure that created the megamillions that got you to be the number 1 casualty insurer in the nation. Just ask Mutual of Omaha. Once the greatest name in health insurance is nothing but a shadow of its previous self after withdrawing from the state of New York in an effort to fight legislation that demanded guaranteed issue coverage to all applicants. They too had reached a positon of dominance in their field, only to lose it when they started to limit their payments for profits sake.
Let just start by telling the truth, treating each other fairly and being satisfied with a job well done and stand up for what is right.
Melanie
It\’s amazing… I see so many people saying the same thing. From the AG of Mississippi, to the media, to non-insurance idiots in these IJ posts.
\”State Farm is leaving Mississippi.\”
State Farm has said they will not write NEW homeowners or commercial policies in Mississippi. PERIOD!!!!
They have not said they are leaving! They are not abandoning their agents or the people they currently insure. They\’re just not taking on new business in the homeowners or commercial lines. This is not new. It has been done many times, in many states, by many insurance companies.
Can any of you read? Especially Mr. Hood! He\’s the biggest idiot out there. All he\’s doing is trying to get the people pissed at the insurance companies and tell them he will fix it so everyone will vote for him when he runs for governor. Anyone who can not see that is also an idiot! Hood cares about votes and power, that\’s it. He does not give a crap about you and never will!
Do you think a beauty pageant contestant really wants \”World peace\”? Hell no! She wants to win the pageant!
As for the non-insurance idiots… I used to be just like you. Then I went to work for an insurance company and learned what insurance was. I suggest you all learn a little about what you hate so much, because without it you would never get a home loan, and would have to rent your entire life.
That would cause problems, too. When the house you rent burns down, you\’d think the landlord and his insurance owed you for your personal property.
I guess it will never end. The world would be incomplete without idiots to entertain us.
Kim, you are absolutely, positively, wrong. The Homeowner\’s policy,HO-3, through competition between companies over the years has become probably the broadest generally sold policy on the planet.
If you really knew anything about insurance, and were accustomed to reading policies, you would understand that.
Instead, it sounds like you are counting words. Yes, there are more words in the exclusions than in the insuring agreements.
The insuring agreement basically says it covers \”all risks of loss\”. Does not take many words to say that.
Then you have a whole string of exclusions, each specific to certain situations. Takes a whole lot more words to do a whole string of exclusions but you still end up with an extremely broad policy.
The fact that flood was excluded from homeowner\’s policies has been widely known for many, many years. There have been many court cases upholding that exclusion, and stipulating that flood includes storm surge.
Policy applications clearly stipulate in bold face type that the homeowner\’s policy does not include flood.
A good agent will suggest it anyway, if you live near the water.
Too many people chose to live near the water and not take the flood coverage.
Yes, it\’s a choice.
Then, when their choice, to save a few $/yr (flood is heavily subsidized by the government, to the tune of over 50%) turns out to bite them in the rear, they start screaming that the insurance companies are out to cheat them.
True, State Farm, with the way they worded their exclusion, is out to cheat their customers. (See my previously posted memo). What they did is despicable. And the state even approved the wording! But the courts are taking care of that. In the first case to be decided, the judge simply ruled their wording wasn\’t enforceable, found against them for the damage, and nailed them with a $1,000,000 punitive damage judgement.
And you can bet that is the basis of the agreement they are now working on to re-open many claims.
But the other companies did not use that wording.
You try having to deal with back to back widespread catastrophes and make judgement calls as to which of the damage was caused by wind (covered) and which by flood (not covered).
It\’s a lot harder than just counting words and posting semi-literate complaints on web sites.
Kim,
To answer your questions yes I am an insurance agent but not along the coast and not for State Farm. They are my biggest competition so I have a hard time leading the cheering section for them. To me they are to the insurance industry what Wal-Mart is to retail. However, I would have to disagree with you about being part of the problem and state that I am part of the solution. Do you have any idea how many billions of dollars insurance companies pay every year to put their customers back where they were pre-loss? A very noble industry if you ask me and one in which none of us including me can live without. One solution for gulf coast states is the national flood program. It was created and can be sold by any agent for the purpose of covering flood damage. Why did they create it? Because flood does more property damage every year than any other peril and is not covered by basic policies. Therefore, if every company automatically covered it the rates would be a lot higher for everyone buying a home, which would keep some people from affording a home. Why should a person in a non-coastal area and not in a flood zone be forced to buy flood insurance under their normal policy when they do not need it? If you have enough money to self-insure then go for it. Nobody is forcing you to buy from a private company. If you think nationalizing insurance will help you are sorely mistaken. The buraucracy that would be created would only make the cost even higher. Insurance companies are no different than a company that for instance bakes bread. It cost so much for the material, baking, transporting to the store etc. If it costs more to make it than they can sell it for than they will not be in business for long. There is a real definable cost of insurance it just is a little harder to put your finger on because losses vary from one year to the next depending on weather etc. However, through competition a company trying to over charge will soon lose market share to a company selling it for less. If you want a company that covers practically everything you can get it. Try Firemans Fund or Chubb out. However, when you get their superior policy you must also realize it will probably cost 2 to 3 times what the State Farm policy costs? Why? Its simple…they will pay more and for things State Farm does not. Kind of like the Wal-Mart thing. Wal-Mart is the cheapest like State Farm but not the best. Why, because coverage and cost go hand in hand. Insurance companies are in business to make money IE profit. What business is not? I bet you do not work at your job for free. Get a life!!!
Do you want to know why insurance compamies will not offer your \”Honest Policy\” that covers everything regarding of cause with no questions asked?
It is because you would not pay the \”Honest Price\” for such a policy.
OK, I succumb to your \”wisdumb\”. If a group, such as the FBIC (Fight Bad-faith Insurance Companies – http://www.badfaithinsurance.org) says it\’s true, it must be so. The opinions of the FBIC could, in no way be biased against insurance companies; and \”Wake-Up-Wal-Mart\” is not biased against Wal-Mart.
Nobody wants to see your cut and pasted stories. Try putting your own opinions down instead of cutting and pasting others. Or maybe you do not have the mental capacity. You can sue and regulate the insurance business out of business if you like. However, you will still need insurance and if it is government based you will simply be covering your risk in the form of higher taxes. I am not a rocket scientist but I bet the private sector can do a better, more efficient, and cost effective way of delivering the product. By the way, making everything run by the government is called Communism and it has been proven to not work.
Money, the donor with rank. A protected angency with no honorable dispute.
That last comment was pretty incoherent again.
It\’s not over,
We\’ve just begun to fight.
Looks like Katrina Winds blew the cover off of this Industry.
Only a sneak peak resulted in trial by jury. The verdict made history.
Do you think this is a secret?
This has caused every homeowner in the USA to check their policy. They are ready to be denied when they are in need.
Word of mouth is the best advertisment.
If they spent that money on claims we would not have this problem.
You will find out just how stupid we are.
All State Farm had to do was try to help us instead of trying to cheat us out of more money than they have already done.
They were blind sided by Greed,
denied their own when they were in need.
They have our Money & took our power too.
We want it back, that should not bother you. You are wrong to trash Jim Hood.
When Elected Officials Stand Up To This,
you try to discredit them as crooks.
Jim Hood, is not the one on trial here.
He did not accept our money, or abandon us when we were really in need.
As a General, Jim Hood is representing American Homeowners as Attorney,
instead of a sword.
Lucky for you, we seek justice in courts.
There is no need to be ugly, even if we disagree. Could/would everyone just be honest, this could be resolved with some kind of dignity.
The Industry can be dissolved and we can live without them.
Self-Insured or Natural Disaster Ins-FEMA
I would rather pay more to reinvest in our State, this has caused me to resent paying them one cent.
In the federal agreement, Hood said State Farm has failed to establish the \”orderly, fair and prompt resolution of claims\” mandated in his state agreement with the company
Ok you win. I agree, State Farm sucks. I am an independent agent. You should try one. We sell a lot of companies and work on our client’s behalf instead of the direct writer agents who only represent their company. When things go bad their companies tell them to tow the party line or risk losing their jobs. When one of our companies tries to tell that to us we say screw you we will move the business to a different company we represent if you do not pay the claims like you are supposed to. Trust me it works. We have a lot more room to get our customers what they are owed because we are not beholden to one company (the mother ship).
Talk about PONTIFICATING!
Kim,
The industry can not be dissolved, and you can not live without them. How would you afford your two houses and the higher taxes you would have to pay for the government to insure them?
Don\’t forget that the money has to come from somewhere. The government doesn\’t just print more when it needs it. AND, U.S. citizens in Colorado, Ohio, etc., don\’t are not going to approve of government sponsored \”hurricane\” insurance that they have to pay into but will never use just so you can enjoy your two houses down near the gulf.
It is YOUR responsibility, not mine, to adequately insure your property. There are insurance products available for you to buy that will fully protect your home from damages caused by a hurricane. Buy homeowners, flood, and excess flood coverage and you will probably always be fully covered for hurricane damage.
And how do you come up with \”blind sided by greed\”? State Farm is a mutual company; that means they are owned by their policyholders. There are no stockholders; and for the size of the company, the CEO is the least paid in the country.
By the way Kim and Melanie. We know you are the same person. Lets try to keep the same name so as we can properly identify the idiots before we read their crap.
Policies have exlcusion and that\’s unfair! You are a joke Mr. Kim. Don\’t like the policy then don\’t purchase it. No one forced you to buy that policy. Frackin entitlement seeker.
Why is it Mark and Ralph are the only ones that make sense? Thanks guys for having a brain and actually using it.
Gee, you are a dead give away.
I can tell that you are in the business.
You are condescending and you twist the truth.
The Policies Have too many Exclusions!
Anything that could damage a home is excluded. They if you slip thru one of the exclusions, they snag you with deductibles & other loop holes to keep from paying a claim.
How many exclusions in the Flood Policy?
Don\’t put words in my mouth.
Don\’t know who Melanie is.
I am using my real name, why would I use Melanie. You are not as bright as you want to be.
Quite the contrary, we are paying for a rolex but we can\’t even get a timex during the worst disaster in history.
What is your real name Mr Big Stuff?
Why is Flood cheaper than Homeowners?
We can live without you, trust me.
Anyone can be replaced.
We will save money and claims will be paid without exclusion.
All we need is flood, you don\’t pay anyway and you charge 3-4 times more than flood.
I Bet that you have a big fat gold chain around your neck too.
I certainly can understand your frustration.
It is easy for me, sitting in my office in Chicago, to explain the logic and legality behind State Farm’s decisions. My home and or office were not destroyed.
As an agent, I’m use to reading policies; I understand the importance of reading the “Fine print” Insurance companies are held to the letter of the law and in turn expect the courts to hold policyholders to the exact terms and conditions of the policy.
One of the problems in discussing this case is the difference between the legal definitions based on the wording in the policy, compared to the commonly understood definition. Katrina was a hurricane. It is common sense that if stand outside during hurricane you are going to get wet. Hurricanes cause high winds, massive amount of rain and yes, storm surge. It goes against reason to argue that hurricanes do not cause flooding.
However, while it is silly to contend that flooding is not connected to hurricanes, it is not silly to argue that it’s not covered on your homeowner’s policy. If a client calls me to report the theft of his car and his guitar in the back seat; I can’t tell him that the stealing of the instrument was not connected to the theft of the auto. But I can tell him that the guitar is not covered under his auto policy.
To make matters more confusing, a storm can cause damage to a structure in multiple different ways at the same time. Your building can be damaged by wind, which is covered, and also by flood that is not. How does the insurance company deny damage caused by a covered peril because additional damage was done by a peril not covered?
To anyone out that that thinks our country would be better off replacing private insurance companies with government agencies, let me remind you of the dismal job FEMA did. Last I checked, FEMA still had thousands of trailers sitting empty. Flood insurance has substantial conditions, limitations, and deductibles. The terms of the government sponsored Flood insurance plan leave enormous gaps, and offer only partial coverage. The people who are now fighting to get their flood claims settled through the plan, might be quite disappointed as well.
I would have hoped that after these storms of 2005, that the government would have stepped in addressed the wisdom of rebuilding structures in low-lying damage prone areas. (There is a reason it’s called a “Flood Plain”) New Orleans was below sea level before Katrina, it is still below Sea level. It is unrealistic to assume that the levies will hold when the city is hit again. The plans need to include replanting the buffer of vegetation that had been replaced with homes throughout the last 20 years. The plan must leave room for controlled flooding to take the pressure off of the levies in times of high water.
There is a lot that the government can do, but becoming the nation’s insurance company is not the right move.
Larry Lubell
Urban Insurance Agency
When did I put words in your mouth? Sorry about the name thing. To answer some of your questions:
1. A regular HO3 or H05 policy covers everything sudden and accidental unless it is specifically excluded. That is why when you read it your mostly reading exclusions. The exclusions with all companies include things such as flood and earthquake, wear and tear, etc. These things can be purchased for those who need or want it. Those policies cover everything versus a flood policy that is very limited to one thing \”Flood\”. By the way, the flood policy has exclusions to. Maybe if you learned how to read you could understand this. You should sit down with your agent sometime and make sure you understand it. You obviously do not.
2. Flood is not cheaper than HO3 and HO5 policies. At least not where I am an agent. Here flood policies are about 2 to 3 times more than the HO3/HO5 policy.
3. You want the insurance industry to just cover everything. That is like telling a guy who wants to buy a Cavalier that he has to purchase the Cadillac. Maybe he does not want or need the Cadillac?
4. I do not where jewelry and I make a modest living.
5. My true name is Al Gore but I am running for president and do not want my tree hugging liberal friends to know I have conservative views.
6. Your arguments border on insanity. You really do not understand insurance. Like I said before, nobody is forcing anyone in this country to purchase insurance from State Farm or other companies. Those of us who vote are not going to allow you to create an insurance entitlement program to cover whatever you feel should be covered. That would simply raise our taxes and we all know that is what you are really after. Redistribution of wealth.
Kim,
My name is Mark, and yes, that\’s my real name, but that\’s all you get. That way no one can look up where I live, or where my second home is, or how many donations for cash or grants I am asking for through some citizen action team.
You see, in your ignorance, you have given up your identity to many on the net. Luckily, I am simply a claims adjuster and not an identity thief.
No gold chain around this neck either. The only jewelry I have is a watch and wedding ring from my wife. She works hard too, but not in insurance. The only vacation we have had in the last ten years… oh, that\’s right, we haven\’t had a vacation. We save our money and much of it goes to our kids, you know, saving for college, medical expenses, food and clothing.
Don\’t have a second home either. Must have been nice to have a vacation home near the gulf when you wanted to get out of New Orleans.
All I know is that if you don\’t let go of your bitterness, you will never be happy, ever. Remember this… The limitations people have are largely self imposed.
Wait a minute!
Sometime back Kim David said he owned his own insurance agency, and had for 15 years!
And he kept complaining about Increased cost of living and rental income not being covered by the insurance cos.
It would certainly seem that what he is really griping about is that he did not see that these things were insured for his clients (was he selling them dwelling fire and leaving out the extensions of coverage, instead of selling them a homeowners?) and not selling his commercial clients loss of income?
Then, of course, when they needed those extensions of coverage, and the companies declined to cover them, he got his rear in a sling?
If he really wants to know how well the government runs insurance operations, he need only look at Florida\’s Citizen\’s Insurance Co. or Florida\’s Catastrophe Fund.
Despite having years to build their reserves, both were bankrupted in \’04 and again in \’05 because the politicians kept the rates well below actuarially sound to please their constituents. Those shortfalls were made up by assessing not only Citizen\’s policyholders, who had benefited from the artificially low rates, but everyone else who had property insurance, and many other coverages. In \’06 the surcharges to cover the \’04 shortfalls were ~12% of premiums. They still haven\’t decided how to cover the \’05 shortfalls except the Cat Fund sold $13 billion in bonds, payable over 10 years by policy surcharges.
Despite Citizens rates that are obviously too low, the legislature, in special session, just reduced them even more.
With no way to fund it, and $13.5 billion of debt to still pay off, they nevertheless increased the capacity of the Cat Fund (on paper, there\’s no money there), which offers reinsurance to insurers at costs below open market, mandated that insurers buy that reinsurance, and pass the savings on to their policyholders.
Now the only way to truly reduce rates is to reduce the amount of damage storms can do, that means making buildings better able to withstand high winds through various mitigation procedures.
Reduce losses, and the rates come down.
The state initiated a mitigation program to make single family homes more wind resistant. The program was funded with $350,000,000 of state and federal money.
To qualify for a matching 50/50 grant to pay for mitigation (storm shutters, etc.) the house must be inspected by the state, and a report issued. Only after the report is issued can the homeowner make the improvements and apply for the 50/50 grant.
The program began in 1/06. By the end of 06 only 12,000 homes had been inspected. That is 48 inspections a day. For probably several million homes.
And, to date, not one report has been issued!
State CFO Alex Sink tried to get the legislature, in it\’s recently completed emergency session, to address the mitigation program. They ignored her.
That, my friends, is how well the government runs insurance programs. They will cave to political expediency every time, and worry about how to pay for it later.
Bill Lockhart
Advanced Insurance Underwriters
Hollywood, Fl.
First: I do not sell P&C, Only Health&Life
Second: I am a lady, not a man.
Third: Again, people were kept in the dark about living expenses and loss of rental income, many lost their policies too.
Not one Agent tried or attempted to offer ANY of these benefits to their clients during the worst disaster in history.
Did they follow company policy?
Did they keep this info from their client because they did not want this to go against their negative score sheet?
This was horrible.
Ignorance of the Insured, a great trump card that makes lots of money for the Industry. The Industry was wrong to use this trump card during Katrina.
Strangers came rushing to our aide.
Celeberties got on TV, they were throwing money our way.
No one owed us, excpet for the Insurance Companies that we paid. Yet our fellow Americans drove in caravans with shelter and food.
Agents turned a deaf ear on their clients
left them standing \”outside looking in\” Never once did they offer living expenses or loss of income.
This was cruel and it was wrong.
How would an Agent explain this to any one of their clients?
I bet the Agent would contact every client immediatley, if/when they receive a lapse or cancel notice.
They feel that hit and that gets their attention immediately.
Premiums already increased an extra
$3,000 + to homeowners hit by Katrina.
Johnny on the spot with increases.
I don\’t want to see anyone hurt. We are all people, with families. We are all law abiding citizens and I believe that we are all good people.
It hurts me to see so much greed.
There is enough money for everyone.
Honesty is free, so we can afford to be fair to our clients.
Every homeowners policy covers additional living expense. Loss of rental income is covered under a commercial policy for, say, the owner of apartments or retail that is rented out.
Loss of rental income is not covered under a homeowners policy.
I live in S. Fl. and when Wilma hit in \’05 I was one of the hundred or so people from our agency that manned the phones (once we had service) to take calls from clients with damage. If their home was uninhabitable, I would explain the additional living expense coverage, and I could hear those nearby doing the same.
It\’s not up to the agent to \”offer\” the payment, the insurers offer the payment. In a situation like this it\’s up to the agent to make sure the client knows he has the coverage – we can access the information via computer – and give a brief explanation.
Re loss of rental income, I know of no commercial client who doesn\’t know they have that coverage – or business income. It is up to them to present the claim to the insurer, and then justify the numbers they are presenting.
the only time I\’ve heard homeowners down here complaining about claims payments is if they turned out to be seriously underinsured. In a widespread catastrophe, the adjusters are going to do triage – get the maximum number taken care of as quickly as possible. That means if a claim is going to involve a lot of negotiation, appraisals, etc. because of a problem like serious underinsurance, those are going to go to the end of the list.
We have condos here that, 17 months after, still haven\’t even had their physical damage claims paid because they are so underinsured – many are actually insured for less than half their replacement cost.
I worked on a condo a few years ago (I normally don\’t touch them – too many problems) at the request of a client that lived there.
They were insured by one of the largest agencies in the country (6th now). 20 some 4 unit buildings plus clubhouse and a few ancillary buildings. I got a plat plan and schedule and drove around, noting each of the buildings. Two were missing from the policy!
They were valued at about 50% of est. replacement cost – I recommended to the Pres. that they get appraisals. he said they had appraisals, but didn\’t want to increase the values.
I explained coinsurance – he assumed I was just trying to drive the premium up.
I finally walked away from the account.
They still haven\’t received a nickel from the insurer because they won\’t/can\’t accept fifty cents on the $. But, that\’s all they paid for!
It is up to the agent to explain things like this to the insured, so they understand, legally it is the responsibility of the insured, not the agent or the insurer, to determine and insure the correct values.
If it\’s not done right, the insurer has no obligation to \”offer\” payment, either for personal or commercial. And the agent certainly has no obligation (or the funds) to offer payments.
I am glad that you offered the benefits to your client.
Down here, Not one Agent notified the client to offer living expenses and neither did the Company.
If you own a duplex, you also have loss of rent, the benefit pays remainder of the lease.
This is Benefits for LA and MS.
None of these benefits were offered and we had to provide evidence upon evidence to get a partial payment, fight and still fighting until I handed everything over to a Law Firm that has guaranteed a Jury Trial where the media will be present.
I am so beat up from betrayal and deception that I don\’t care about my future. I had to let the Lawyers fight for me. If I sound angry, I am and it\’s not my nature. I feel like I have been in a war fighting by myself. The only people with interest are ones that can jump on the wagon and profit.
It\’s been like a Gang Bang.
Every company denied the full benefit.
ANPAC in LA Paid $8,000 out of $34,000.
ANPAC IS NEXT ON MY HIT LIST-WORKING ON THE TRIAL RIGHT NOW.
State Farm MS Paid $ZERO.SAID ALL WATER DAMAGE.
Kim, why not admit you did business with the wrong company rather than vilify all insurance companies?
Well, it may be more than just doing business with the wrong insurance co.
the only claim I\’ve ever had involved a fire in my garage from an extension cord.
You would think cut and dried. I even told my public adjuster (my busiest time of year, I did not have time to deal with it (I sell commercial P & C) that much of the stuff in the garage I wasn\’t going to claim because, let\’s face it, there was a reason it was in the garage.
I had ~ 30 days of additional living expense while they cleaned up the mess and repainted the interior.
Kemper Insurance (remember the calvary?) could not have been nastier. At one point I was out of pocket over $30,000 and they had not yet paid $.01.
We could have stayed in a nearby Hilton (we have a nice house) but instead went to a modestly priced hotel which had refrigerator and microwave in the room, and negotiated a lower price based on staying 30 days.
Yes, we ate dinner out at restaurants, but most places serve more than we can eat, so we took it back to the room, refrigerated it, and that\’s what we had the next night.
We had some special paint effects on the interior walls which their adjuster agreed with my adjuster on the cost per sq ft to clean, sand, and repaint.
Their office adjuster rejected the figure without ever seeing their own field adjuster\’s report.
They took the cord and switch off my table saw, even thought it had nothing to do with the fire. It was a 20 year old saw, I could not get replacements, they would not return them.
They could not have been nastier, more difficult to deal with, and more wrong.
I eventually got everything I was claiming, but at a cost of far more time and effort than was necessary.
Of course, they are used to claimant\’s trying to screw them. But, being in the business I told them up front I was not trying to do that. I told them, quite clearly, I was only looking to be made whole on the repairs to the house, and replacement of the damaged stuff that I wanted to have replacements of. I even gave them a list of the stuff that was damaged but that I was not claiming, because the sub-woofer was blown and was in the garage waiting for me to dispose of it, the curtains in the which were hideous, I just had never gotten around to taking them down and throwing them away, the amplifier in the garage which no longer worked, it was there waiting my annual trip to recyclying, etc., etc.
It didn\’t matter how honest I was trying to be, they were going to be nasty and resist.
They did in the end pay the full value of our meals, technically, they were only responsible for the difference between what we paid eating out, and what we would have paid eating at home. And they paid for the hotel room.
Now this was an isolated claim, it wasn\’t one of 10,000\’s or 100,000\’s, and There was no reason at all for Kemper to be such assholes, but, by God, they were, to the end.
Now I know they are used to getting screwed. Fla building code says if your roof is over 25% damaged, you must replace it completely.
I have a client whose neighbor lost a few tiles off his roof. He got up there, removed enough more to be ove 25%, collected enough to replace the entire roof, then put the old tiles back.
20+ years ago my own brother had a metal roof on his house outside Orlando.
They had a bad hailstorm which put some dents in it. He claimed he was going to have to replace the entire thing, they gave him a check for $16,000. That same roof is still there.
So it\’s a combination of bad insurance cos. and bad insureds, but in a situation like Karina, they should be bending over backwarks to help their own customers.
Mr Hood Please look at the history of State Farm Looks like Enron. Fraud is a Crime.State Farm dose not want to pay out anything to anyone But will pay out 80 Million denieding claims. (Abused)( Fraud) someone is lacking good sense. Anyone with backbone?Is that what we have all come to (corruption)tear down the people that have lose so much all in the name of money. Rust and Loy The American people are not foolish the joke is on State Farm. Have a great time with the Millions people have paid for peace of mind..The web of state farm,s employment has made people think we our out to get them, . All people want is what has been sold to them. No more and no less. Remmber this Ralph.
You are right, I am bitter and that is not my nature.
I feel like I have been in a war, fighting alone.
I have been slow paid, denied, lied to, cheated,
looted, ripped off and robbed by Chase Bank.
Then there\’s Contractor Fraud & theft of building
materials and the Army Corps levee litigation.
I also have a brother who lost his home too.
He broke his neck when he was 17, he\’s been
paralyzed since. A local Contractor took $80,000
then walked off of the job without even buying a
toilet. I\’ve been working with LA Attorney General
obtaining evidence & providing evidence which is about
to result in the Contractor will do a few years in prison
but we will will not be able to gecoup any of the money.
He does not own anything under his name.
My Father died before Katrina. We were still grief
stricken with his sudden death. He lived his life
helping people, he was a Fireman, Retired Chief NOFD.
He took care of my brother.
How much more can I tolerate before I snap?
Loosing everything from Katrina was nothing
compared to the betrayal thereafter.
I can\’t be in 3 places and I can\’t run my business
or think straight.
My plate is full of so many different problems
and I have never sued anyone in my life.
I don\’t answer the phones when I am still paying
for current ads, running in MS and
LA. I Was just about finished MS Office,
I had he papers to file for a MS license,
then the office & home were destroyed.
Who sells health in MS? I can send the calls to you.
These people are calling me for Health Insurance
but I can only sell LA. Still paying office rent,
expenses,
advertising, House notes, and Ins. too.
You will never understand this feeling
until this happens to you.
Insurance was piece of the nightmare.
I am a funny person and I love to laugh and
live my life.
I am doing everything that I can to keep my
sanity and vent in the right direction because
if I held this in, I would have flipped out already.
Thank you guys for a good argument, it\’s like
therapy. Sorry if I seem to be ugly.
I was married one time & divorced when my baby
was 1 month. I lost everything that I owned, left
him without a dollar or a job.
My little girl and I ate lots of hot dogs and eggs
but we were happy and rich with love & laughter.
I have never remarried or even lived with a man since.
Old fashioned & Italian, I remained a single Mother
for 25 years. My daughter graduated from college
w/honors and is happily married.
Her father committed suicide when she was an honor
student in Mt.Carmel High.
After I got my life & finances together,
I bought a place on Bayou Lacroix, it was next to the
home we had when I was a little girl. I think they call
this, the full circle.
I a self made and I never accepted charity.
I never heard of FEMA, until Katrina. I cried when
the Red Cross gave me a clean, cotton T-Shirt.
Humble pie and tears in your eye, I left thinking
I would return within 24 hours.
I remember eating hot dogs & eggs and I never
think that I am better than.
I listen to someone cry and try to understand
exactly why.
What good is money if we don\’t care about each other.
See, what money has done to Anna Nicole & her children.
Then there\’s Johnny Cocharan, who became rich & famous
for helping OJ escape double murders.
Look where Cochran lives today-6\’ under.
I am not religious, but I am spiritual.
I don\’t wany sympathy or charity,
I am letting you know where I come from and how I got here. I did not get this far from staying home, eating bon-bons.
I am strong, independent and a survivor.
If we have a God, he sees it all.
Could all of the natural disasters be hints from above.
We are all his children and no one wants to see their child betrayed.
I think God is angry too,
in fact I think he is crying.
People PLEASE. See this for what it is .we will not give up! (State Farm, do you not hear the cry,s) You May Not care but we all do.
We had the same problems here in S. Fl. with unlicensed contractors stealing from people. The various governments all broadcast warnings – get their Fl License #, get a certificate of insurance, verify their license with the state before you give them a nickel.
A lot to do when your house has been severely damaged, but your ONLY protection against crooked contractors.
Then flood vs windstorm causing the damage. I don\’t know what State Farm has filed in La., but in Miss. their homeowners policy said that if there were first windstorm damage, then flood that would have caused the same damage, there was no coverage. If they deny because the peril of flood isn\’t covered, then there\’s no additional living expense or loss of rents either.
I haven\’t heard anything about that wording being used in La., but that is the basis of the suits in Ms. There the trial judge halted the jury trial before that question got to them. he just said flat out that that clause was unenforceable and directed State Farm to pay. The only question for the jury was the amount of punitive damages, which he reduced from $2.5 million to $1 million.
That State Farm had that wording in their policy is absolutely despicable. In 39 years in the business I\’ve never seen anything so despicable.
The amazing thing is, the Ms. State Insurance Department APPROVED that language! How that got by them I don\’t know.
State Farm has now agreed to pay, I think it was $80 million, more to settle other similar claims in Ms.
Note: An earlier suit before the the same judge resulted in him making a declaration that flood, including wind driven storm surge, is NOT covered under the homeowners policy. He reiterated that that is long established case law. (I\’m sure Trent Lott (house on the beach, no flood insurance!)was not happy with THAT decision!)
If you have that same language in your policy, your attorneys need to bring to the court the decision in the Ms. case, which was in a Federal Court, not state court.
Allstate, Nationwide, others have said they do not have State Farm\’s wording in their policies so, despite the MS attorney general now turning his guns on them, they are not worried.
Besides State Farm\’s wording, much of the problem lies in the definition of flood plain, as used in the National Flood Program.
They define areas as flood plains based on the likelihood of flooding from falling rain. They do not take storm surge into account, although it fits the definition of flood in the homeowner\’s policy and the flood policy.
Areas unlikely to suffer flood from falling rain, but likely to suffer flood from storm surge, are not listed as being in a flood plain.
Thus we had people living on the beach but, because of the elevation of their building (on a hill or dune, for instance) they are not likely to suffer flooding from a 100 year rains storm but, as we see, they are vulnerable to flooding from 30 ft storm surge.
Not being in a designated flood plain, many living on or near a beach decided to save a few hundred dollars a year and not buy flood coverage.
Much to their (and Trent Lott\’s) dismay, the courts are and will hold they have no insurance.
Only if they can prove there was wind damage BEFORE the flood damage will the courts find coverage for them under the homeowners.
Kim, I wish you the best of luck, and I am really sorry for all you are going through. I just hope your attorneys nail State Farm to the wall, with really BIG nails.
My home in New Orleans never flooded until Katrina. Class Action Suits against Army CORPS, accused of skimming money & materials resulting in the breach of the levee. The levee broke after Katrina left.
MS had 100X more damage than LA.
The wind blew the roof off the dome in LA.
Sure FEMA made mistakes and Michael Brown was the largest scape goat in history too.
HOWEVER, KATRINA HOMEOWNERS WERE PAID.
FEMA paid 100% of flood claims without trying to put the blame one wind.
State Farm denied Living Expenses by blaming all of the damage on water.
Other companies paid a portion of living expenses, they paid a percentage on wind.
When I called ANPAC to request living expenses, they said to mail copies of my receipts for food and rent and they would reimburse me. It took forever to get this together for them, I had to find 12 months of Statements for 2 Visa Credit Cards, copy them, highlight all food charges, add each page, total all charges, then mail it certified.
To prevent the old Lost in the Mail trick.
ANPAC sent a check for $8,000 out of $32,000.
When I called ANPAC, to question the 8,000 Amount, ANPAC SAID,
\”We Cannot Pay For YouRRR FoodDDD\” !!!
Arrogant & Insulting in spite of playing me as a fool.
I said, \”YOU, were the one that told me to send you my food receipts\”, and I questioned why you would pay for food.
He said, You would have had to eat without Katrina\”.
I was furious & insulted to the point that I busted out crying, from the insult.
ANPAC said, we pay a percentage of what wind did and what water did.
I disputed that too, I said,
\”Sir, my policy does not have percentages in it\”.
I did what they told me to do, then they treated me as if I were a low-life trying to get free food.
I asked about loss of income.
ANPAC said, we were not aware that your home was a duplex. I said, \”read the Policy\”.
Still ANPAC refuses to pay $1.00 for rental income and only paid $8,000 out of $32,000.
I just hired a law firm and demand trial by jury; we will not accept a settlement, not even on the courhouse steps.
This is what made me realize that you should Never talk on the Phone with your Insurance Company or Mortgage Co.
You should put everything in writing. What they tell you on the phone is completely different from what they put in writing.
A bait and switch trick.
They buy time… while You are Gathering Evidence to provide to them, when the evidence is never good enough to get the claim paid anyway.
ANPAC said, based on the evidence we have gathered, we cannot pay any more wind claims and we will not pay any more living expenses.
I Responded with, I am sick & tired of providing you with evidence and now, I would like for you to provide me with the evidence that you have gathered to deny my claims.
I am forced into litigation. This is stressful and insult to injury.
We have to hire Lawyers in order to get
what we paid them for.
Is this America or the United States of Russia? Are we going to allow this on our own land?
This is a war, Inside America.
We, the people must come first!
This is what we\’re fighting for.
Jim Hood is a hero! How can you knock him? This man, one of the few men that ever stood up to the system.
He demanded justice for this act of piracy. I would like to see how much the Ins.Industry contributes to Hoods next campaign. I bet he\’ll get what we got.
He is fighting for the American People.
Like it or not, but the truth hurts.
Do you think this man would take a stand without enough evidence?
Jim Hood made history. The only elected official that rolled his sleeves up to fight the big boys…Sweet Baby Jesus…
and won too.
This is not what our men died for.
It\’s not about money anymore, it\’s about betraying Americans on American soil.
I am on the front line trying to fight
for what is right, and I am willing to fight to the end of my life because I believe in Justice for all.
I\’ve nothing to hide. In fact, the only thing that I have left, is truth.
I came into this life with nothing and I will leave with nothing. Until then, I will try to make a difference and I will try to leave something behind. Somthing that may help others, after I am gone.
Knowledge is power and our children are the future, policyholders.
Can you explain to our children, why they did not have Santa in Christmas 2005?
Mommie & Daddy trusted State Farm. We paid them to financially protect our home.
We told our children that we were insured,
they could buy new toys. They were witness and victim too. It hurt to see them cry. We said, don\’t worry, you can buy more toys.
Then came the denial, we had to explain that too.
So, Our children never got toys for Christmas but a gift they got indeed.
It\’s called one of life\’s lessons, a gift they will never forget but will always remember State Farm. They have learned from their Parents Mistakes.
If you don\’t make changes now, you will not have a future. The Industry will deduct Agents commission before they loose a penny. In the end, they will eat their own. We must take a stand.
Like I said, your claims experience has a lot to do with your carrier\’s corporate philosophy, and the competence of the adjuster, and the quality of the agent. I can say none of our carriers set out to screw the customer; in fact some paid more than they should have. We get many referrals from clients for whom we went to bat.
Since I was born, the commandments were read, bearing false witness is what one of them said.
\”The Good Neighbors\” was their claim,
Ironic, God had already etched in their name.
Hit by a Hurricane, a Category 5…
They blamed the water, before we awoke.
Is this what he called
A Wolf in a Sheeps Coat?
Denounce them by name is what he said
and this is what we should do.
The New 10: How To Treat Your Neighbor:
1.Thy shall not bear false witness with
Engineering Firms.
2.Thy shall not contribute to political
campaigns.
3.Thy shall not deny my winds.
(this one cost you)
4.Thy shall not make deals in the Lobby.
5.Thy shall not covet thy clients money,
nor tempt Man, or God.
6. Thy shalt not commit fraud.
7.Thy shall Cover Thy Neighbors House
with Contents and pay living expense too
8.Thy shall not trick thy neighbor with
loop holes & exclusions.
9.Thy shall not sell false policy with
many deductibles;
10.Thy shall not sell Hurricane Insurance
when thy policy does not include
hurricane insurance by thy exclusion.
10 A. Thy shall not piss off…my sons…
in Mississippi.
Many adjusters knew exactly what to do and not to do.
Many adjusters were innocent, unexperienced but the Company that paid them made the rules.
GOLDEN RULE: THE ONE WITH THE MONEY MAKES THE RULES