Connecticut Lawmakers Create ‘Insurance Company’ to Help Homeowners

By | November 7, 2017

  • November 7, 2017 at 10:49 am
    Frank A. Lombard CPCU ARM says:
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    Most if not all of these homes with “defective” concrete in their foundations have also sustained structural damage. This often “hidden damage” is never mentioned when discussing these claims. This “ensuing loss” (hidden damage) should be covered by their home insurance policies. In addition, policy terms require policyholders to take “reasonable steps” to protect their property from further damage. “Reasonable steps” could include the cost to raise the structure so the defective concrete can be replaced. Raising the structure represents the major portion of the estimated $200,000 per home repair cost.

    Since the captive insurer will be funded with public money, will the captive be able attempt to “subrogate” a major portion of these claims to the homeowner’s insurance carrier?

    • November 7, 2017 at 4:25 pm
      Agent says:
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      We hear all the stories on the State of Connecticut finances, the pending possible bankruptcy of Hartford. Hey, raise taxes once again to fund this project.

    • November 7, 2017 at 6:05 pm
      PolarBeaRepeal says:
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      I don’t think an HO policy will cover the damage because the captive was formed to retro-actively cover…. something.

      I wonder why the home builder general contractor’s GL policy doesn’t come into play here. There is known use of known faulty materials, so either the liability policy of the foundation construction sub or the GC should be pursed for indemnity.

      I’ll assume for the meantime that they are unable to determine the sub(s) constructing the foundations, but I don’t have an answer as to why the GC isn’t liable under at least one statute or respondeat superior.

      There may be multiple GCs who weren’t adequately insured, whereas SOME GCs were adequately insured and the latter set of claims are not part of this matter.

      • November 8, 2017 at 10:30 am
        Frank A. Lombard CPCU ARM says:
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        I understand there is a lot of finger pointing here but these homes have sustained structural damage as a result of a defective material. Their homeowner’s policy should have covered that “ensuing” damage. And to prevent additional structural damage,if the structure must be raised so the defective material can be replaced, that cost should be covered as well.

        The home insurers or this “to be formed” captive insurer should have the right to recover monies paid to the impacted homeowners; they have the resources,expertise and motivation to do so.

      • November 8, 2017 at 11:15 am
        PolarBeaRepeal says:
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        I’m still struggling with the pathway of the subro rights on this matter. I’ll reply later if I find out more about it. Currently, I’m at a loss to explain why ‘some party other than home insurers’ isn’t liable for the damage. I understand dissolution of home building contractors, or their insolvency, causing unrecoverable indemnity payments, but the details aren’t found in this article.

      • November 8, 2017 at 11:17 am
        PolarBeaRepeal says:
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        I understand your point on future loss mitigation. I don’t think that’s why the state-owned captive is being contemplated.

  • November 8, 2017 at 12:21 pm
    Frank A. Lombard CPCU ARM says:
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    I agree but the captive will be funded with public money, it should have the right and duty to recover any money paid to claimants which should have been the responsibility of other parties-the impacted homeowners’ insurers or others.

    • November 8, 2017 at 4:32 pm
      PolarBeaRepeal says:
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      Oh, I’m in agreement with you on the subro rights. I just wonder why that route is being taken rather than seeking direct indemnification from the liable party(ies). It seems like it (i.e. captive insurer owned by CT) will help in subro in cases of insolvency or dissolution of construction contractors… the latter of which may have occurred in high numbers in the 2008 Economic Meltdown, especially regarding the housing industry.



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