In the Market for a New Homeowners Insurer? What You Need to KnowJanuary 2021
Want a Better Business in the New Year?January 2021
by Stefanie Powers
Two back-to-back hurricanes hit Southwest Louisiana with a double wallop that left homeowners reeling. The storms are estimated to have done more than $14 billion in damage to west Louisiana and east Texas.
In the days that followed, it became abundantly clear that the response from insurers was, in many cases, lacking. Frustrated claimants are wondering what to do next. If all else fails, it may be time to contact an attorney.
The Lake Charles law firm of Broussard + Williamson receives calls every day. “There are lots of problems,” says partner Aaron Broussard. “Insurers are overwhelmed, but that’s because they chose to understaff their response teams. Then, they sent out of a lot of rookie claims adjusters who did not have the necessary experience or knowledge to do the job right. Many of them quit or were let go shortly after the storm, and then someone else had to take over resulting in even more delays. In short, the larger insurance companies wrote more policies than they could handle. But that was a choice motivated by profit, so don’t feel sorry for them.”
This isn’t to say that the insurance companies don’t have the money. “They have it, but they are holding out,” Broussard continues. “They will give you a long list of excuses for their delays. Don’t buy them. They may also misrepresent coverage, either because they don’t understand their own policies or they are intentionally trying to shortchange you.”
Broussard + Williamson has compiled some helpful guidance for those handling their own claim:
- Only communicate with your insurance company by email and always reference your claim number in the subject line.
- Send new information to your insurance company as you receive it. After you have proof of your entire loss, resend everything in one package/email.
- Your insurer must pay the undisputed amount of your claim within 30 days of receiving satisfactory proof of loss without requiring any signatures or releases.
- It is okay to deposit checks from your insurance company before your claim is final, as long as the check or paperwork does not state something like “FINAL PAYMENT.”
- If you have any questions about your claim, ask an attorney for advice. Most attorneys will not charge to review your claim.
- You should get advice from an attorney if your insurance company has: 1) denied coverage of any loss 2) treated you unfairly 3) delayed your payment 4) made inconsistent statements, or 5) refused to accept your contractor’s estimate.
If you decide to hire an attorney, certain steps will be taken.
- “We use a three-step process. We start by resending the information you already gathered with a demand from our law firm,” says partner Michael Williamson. “Often, a letter from an attorney is all that is needed to motivate the insurer to do the right thing. If all we need to do send this letter, we do not charge a fee. If our first letter does not work, we visit the property, either sending out our own expert, or an independent party. From there, we send a new demand package to the insurer, urging them to do what is right. If this demand doesn’t work, it’s time to take the next step and file a lawsuit.”
- There is a light at the end of the tunnel. Lawsuits usually take a long time, but Williamson pointed out that Federal Judge James Cain recently approved a plan to expedite hurricane lawsuits against insurance companies. “The process is similar to what judges in Texas used after Hurricane Harvey and New York used after Superstorm Sandy,” Williamson says.
- Insurance companies and the parties who sue them will have to share information with each other as soon as possible and then meet (online or on the phone) within a month of the deadline to share information and discuss a possible settlement.
- If the two sides can’t agree on a settlement, the case will go to mediation. Anyone who wants to opt out of the process will have to file motions with the Court.