Florida Regulator Calls on Insurers to Handle Hurricane Michael Claims

By | December 31, 2018

Florida Insurance Commissioner David Altmaier is urging Florida insurers to close the more than 42,000 Hurricane Michael claims that remain open nearly three months after the storm.

In a Dec. 19 memorandum to all property and casualty insurers authorized to do business in Florida referencing undisputed Hurricane Michael claims payments, Altmaier reminded the industry of a Florida Statute that requires property insurers must pay “undisputed amounts or partial full benefits owed under first-party property insurance policies within 90 days after an insurer receives notice of a residential property insurance claim…”

The memorandum goes on to say that for insurers to facilitate the payment of Hurricane Michael claims, insurers should have sufficient claims adjustment and consumer service resources to “provide policyholders with access to effective customer services.”

Total insured losses from the Oct. 10 near Category 5 storm passed $4.5 billion as of Dec. 14, according to claims data from the Florida Office of Insurance Regulation. Residential property claims, which include homeowners, dwelling, mobile homeowners, and commercial residential, totaled 88,624 with 68.9 percent of those claims closed. Total claims closed for all lines of business – residential property, commercial property, private flood, business interruption and other lines – was 68.3 percent.

“Insurers may need to augment available claim or customer service resources, establish mobile claims offices in the Florida Panhandle, initiate outbound calls to claimants, or take other action to provide quality policyholder service,” Altmaier’s memo stated. “The Office expects insurers not only to comply with the provisions of Florida law but also to do everything possible to respond to the needs of affected Floridians, restore a sense of normalcy, and facilitate restoration and recovery in impacted communities.”

Florida CFO Jimmy Patronis, who called on the industry to step up their response to Hurricane Michael claims back in November, issued his own statement in response to Altmaier’s memo, saying he expects insurers to “keep their promise and obligation to Floridians and pay undisputed claims quickly.”

“Insurance companies must do everything possible to ensure those impacted by Hurricane Michael are made whole. If they don’t fulfill these expectations, Florida insurance consumers will be more vulnerable to fraud,” he said.

On Nov. 19, Patronis held a conference call with more than 40 insurance representatives and discussed what he called “alarming trends” since Hurricane Michael, including delays in processing claims and insurance-related complaints that had come into the Division of Financial Services’ Consumer Helpline.

DFS said as of the end of November, it had received 993 Hurricane Michael insurance-related calls. Of those, 24 percent of the callers expressed concerns regarding a delay with the handling of their claims; such as waiting for an adjuster to come out and assess the damage or no follow-up or response from the company; 15 percent of the callers had specific questions about their claims or the claims process in general; 13 percent of the callers had general and/or specific coverage questions; and 10 percent of the callers expressed concerns regarding a claim denial, cancellation or non-renewal of their policy or an unsatisfactory settlement offer.

Of the 993 calls, 138 had turned into complaints, DFS said in an email to Insurance Journal on Nov. 29. For comparison, this same time period after Hurricane Irma, which impacted the entire state of Florida, DFS had received 3,764 calls. Of those calls, 394 were complaints.

Altmaier stressed in a statement regarding his memorandum that he and Patronis expect insurance companies to not only comply with the provisions of Florida law, but also “to do everything in their power when responding to the needs of Floridians.”

He said an immediate, increased effort to facilitate restoration and recovery for all policyholders impacted by Hurricane Michael should be every insurance company’s top priority.

“Hurricane Michael caused catastrophic damage, rendered thousands of our citizens homeless, and destroyed critical infrastructure. Countless first responders, crews, officials and volunteers continue to work around the clock to support and rebuild communities that have been forever changed — we expect nothing less from insurance companies,” Altmaier said.

Read Memorandum: OIR-18-01M.

About Amy O'Connor

O'Connor is the Southeast editor for Insurance Journal and associate editor of MyNewMarkets.com. More from Amy O'Connor

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