 The Florida insurance market is being disrupted and insurance companies want everyone to believe they are losing money and have to raise insurance premiums. The true culprit of rising insurance premiums and the losses reported by insurance companies, is the unlicensed and fraudulent activity that is rampant throughout our state.
So why should you be concerned? Insurance premiums are continuing to rise with no end in sight. Insurance companies are no longer insuring property owners in certain zip codes, they are placing $10,000 water damage limits into policies or eliminating water damage coverage all together and there are more “managed repair” or “right to repair companies” popping up daily. As a result, you now have limited options of admitted insurance companies to insure your property thereby leaving you to be insured with a surplus lines insurance company. I wrote about the difference between an admitted carrier and surplus lines carrier in last week’s blog which you can read here. There are so many times when I hear that the insurance company is dealing with these unlicensed individuals who are telling unsuspecting policyholders they can handle their insurance claim when they are not licensed to do so. Often times, these individuals think they are hiring a public adjuster, and in fact, they are not. This not only proliferates the problem, but the insurance carriers are aiding and abetting in this unlicensed activity. Did you know that unlicensed activity is a 3rd degree felony in Florida? It is and only a licensed public insurance adjuster or attorney can legally assist a policyholder with a property damage insurance claim. Make sure you do your due diligence and understand who is insuring your property, what coverages you have and what restrictions are being placed in your policy. You definitely do not want to be surprised with limited or no coverage should you have an insurance claim. We offer free insurance policy reviews and you can contact us here or call 561-288-6434.
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 We have received many calls these past few months from prior clients inquiring about insurance companies that their agents are trying to place them with. They want to know our thoughts and if we have dealt with them.
Let me begin by explaining the difference between an admitted insurance company and a surplus lines insurance company. An admitted company sells insurance products that are regulated by the state. In Florida, that is the Department of Financial Services (DFS) and if you have an issue with your insurance company, you can turn to DFS for assistance. However, a surplus lines company can sell insurance products that are not regulated by the state and essentially, they play by their own rules with the state having no authority over them. So to add insult to injury, we recently learned that some surplus lines companies are placing restrictions on unsuspecting policyholders by not allowing them to utilize the services of a public adjuster should they need help with their insurance claim. Why would an insurance company want to restrict you from seeking help should you need it? Why is it okay for the insurance company to have a field adjuster “help” them, but you can’t have your own adjuster help you? This is terrible public policy and you, the consumer, have no protection and it's not okay. Surplus gents are currently required to show their efforts to place a policyholder with an admitted company before placing a policyholder elsewhere. This does not seem to be happening as I experienced this myself while looking for a new policy for my parent’s home. Although I specifically requested not to be placed with a surplus lines company, that was the only quote I was provided. I insisted that they continue looking and of course, was provided a quote with an admitted well known company. It turned out that the admitted company was a more affordable policy then the surplus lines company. It really doesn’t take a rocket scientist to figure out what was going on in this instance. I cannot stress enough the importance that you understand what insurance you are purchasing! It seems apparent that some insurance agents are placing policyholders with surplus lines carriers right off the bat, without fully explaining the difference and type of company, the restrictions and limits within the policy, nor are they searching for coverage with an admitted company. If you have any questions or concerns about your insurance policy, we are happy to assist and we offer free insurance policy reviews. Please contact us here or call (561) 288-6434.  There is no secret that insurance companies try to increase their profits and limit their losses. I understand that they are running a business, however, minimizing their losses should not be to the detriment of you the consumer, the policyholder. You pay your insurance premiums when they are due and you expect to be paid when you have damage to your property. That’s not unreasonable. You should be paid what you are owed if you have an insurance claim. Yet when you file a claim, they try to limit your payout.
Insurance companies want everyone to believe they are losing money so they can justify their rate increases, when in fact they are making money, and have the large salaries to prove it. This leads me to share a story. A client of mine who had three young children was brought to tears one day. She had a broken waste line pipe in the kitchen wall that not only damaged her kitchen cabinets, it resulted in additional water damage to the home and caused mold. The insurance company grossly underpaid their claim. I don’t know how they expected her replace her kitchen and do all the repairs for $2500.00! I know. Believe me, they were just as shocked, just like you are reading this. We submitted all the requested documentation to the insurance company together with a very detailed estimate, photos, reports and a valuable explanation supporting our client’s request for payment. After discussing the claim in further detail with the adjuster and providing clarification for him on a few items, we were hopeful that someone was finally going to listen and be reasonable. Then the adjuster called me and said “I have no authority to settle the claim. It’s going to be up to management what they do next.” So, the “powers that be” get to decide, based solely on numbers and not facts, whether she would get paid for the claim or not. This person had not seen any of the documentation we provided and had not discussed the claim with me at all. All they saw were dollar signs, not circumstances or facts. Although they should, the powers that be do not put your best interests before that of the their own. So, when insurance companies claim they are losing money and request rate increases, I say that the people who regulate these insurance companies should dig deeper into the facts and do more to protect Florida consumers.  When you live in a villa or a townhome and your building is under one roof system, who is responsible to replace the roof when the roof needs replacement? That can sometimes be tricky. If your HOA documents state the roof is owned by you, then technically, the roof is your responsibility and it falls on you. But how are you supposed to replace only your roof when your roof is shared with your neighbors under one roof system?
Generally, in situations like this, the HOA will set funds aside for the roof replacement in their “reserves”. This is an important factor that you should know and understand. You should contact your association to find out what their role will be in this situation. Back after Hurricane Wilma in 2005, I represented a client who owned a townhome. Although the roofs were the responsibility of the individual homeowners, they were also attached to their neighbor’s roofs. At that time, the association had been poorly run and many homeowners were defaulting on their monthly payments. The association was out of funds and could not assist the community with their roof replacements. Each homeowner filed their own insurance claim and some began replacing their roofs. Once this happened, the roofs in the community no longer matched and they lost consistency in the appearance. In addition to this, because one homeowner replaced their roof and another didn’t, the tie into the other roof was difficult and the “old” roof system leaked causing damage to the unit with the new roof. I know this for a fact because it happened to my client, and although she replaced her roof and completed all her interior repairs, her neighbors did not replace their roof and it leaked into her home causing interior damage again. It is important to read and understand your homeowner association documents to know what portion of repairs is your responsibility and what are the association’s responsibility. I also recommend that you know the financials of your association and attend all meetings when they are scheduled. You can always rely on Reliant for any questions relating to your insurance policy and homeowner’s documents. Call 561-288-6343 or contact us HERE for a free policy and document review. |
