A class action lawsuit was filed Tuesday against 21st Century Insurance Co. on behalf of policyholders who filed timely property damage claims stemming from the 1994 Northridge earthquake but whose claims were mishandled, said plaintiffs’ attorney Brian Kabateck, partner in the Los Angeles law firm of Quisenberry & Kabateck.
The complaint charges that 21st Century Insurance (formerly 20th Century Insurance) took part in unfair and fraudulent business practices to minimize the amount of benefits it had to pay to insureds who incurred property damage during and after the Jan. 17, 1994, Northridge earthquake. More than 4,000 21st Century Insurance policyholders may be part of the class, according to the plaintiff attorneys in the case.
The lawsuit alleges that 21st Century deliberately lowballed policyholders on the estimated damage from the earthquake or tried to attribute the damage to pre-existing conditions of the property. The insurance company also is alleged to have used unlicensed, uncertified or unqualified contractors, engineers and testing companies to assess and estimate damage and losses. Mistakes were reportedly made, and when policyholders found more damage and contacted 21st Century to file additional claims, they were allegedly told the statute of limitations for filing had expired.
Under a new law that went into effect on Jan. 1, 2001, policyholders have a right to sue their insurance companies to force them to reopen previously filed insurance claims relating to the Northridge earthquake. But plaintiffs attorneys in the suit say this case is different, because the suit also seeks to halt the alleged unethical business practices that created the situation.