Executives at Florida-based Wyeth Ratings are warning of the high number of claim denials in the aftermath of Hurricanes Helen and Milton, calling it a “double tragedy” for homeowners in the state. ”.
Dr. Martin Weiss, founder of Weiss Ratings, said: “The number of denials is shocking, especially when homeowners have diligently paid all premiums and followed all regulations.”
Florida currently has some of the highest home and auto insurance premiums in the nation. There is a wide disparity in flood insurance coverage, with approximately one in seven homeowners choosing to go uninsured.
Nevertheless, an initial report from the Florida Department of Insurance Regulation revealed that between 60% and 80% of insurance claims related to recent hurricanes are unpaid. Of the approximately 360,000 claims received, nearly 40,000 have already been denied.
Homeowners are facing a months-long process and many have not received their full payments, according to Wyeth Ratings.
“This is a tragedy for anyone who has to make a claim because their home has been destroyed, whether by Helen or Milton or anyone else that has happened over the past year or so,” said the Director of Investigations. Gavin Mageau said. Weiss Ratings said:
“It is very disappointing for homeowners that Mr. A paid a high premium, Mr. B suffered severe damage, and Mr. C was harmed twice and suffered further injuries. That’s tragic,” Weiss added.
Reasons for refusal not disclosed
The rating agency’s founder also blamed the lack of transparency surrounding the denial. He said these issues are “not transparent to us from the outside” and “we don’t even know if the insurance companies themselves are compiling the data or keeping statistics on the causes.”
While he acknowledged that some denials may be justified, he questioned whether insurers were taking advantage of discrepancies in wording to deny claims. For example, if a policyholder does not have specific flood coverage, we will deny any claim that even mentions the word “flood.”
“We believe that the higher-than-expected losses occurring in Florida and the financial pressures on many of these companies will lead to companies using this mechanism as a tactical tool rather than to reduce liability. “I’m concerned that this is an objective standard operating procedure,” Weiss said.
One of his main concerns is that a “man-made economic disaster” could prevent residents from continuing to purchase insurance, own property in Florida, or even reside in Florida. That means there is.
“This is not a game”
But this problem is “not just a Florida problem.” Data published on the rating agency’s website, compiled from filings late last year, shows that dozens of insurance companies across the country have denial rates above 50%.
But when it comes to Florida in particular, Weiss suggested the situation is a political one that has been going on for years.
“This is essentially a tragedy that is only made worse by people playing games and playing politics with policies,” Mageau said. “Consumers don’t deserve that. Policyholders should be treated with respect and have their claims paid properly and promptly, without insurance companies trying to pocket money on them. It’s not a game that should have been played and unfortunately it’s expected to happen.”
What can consumers do?
Despite the challenges, Weiss said consumers can:
Research highly rated insurance companies before purchasing insurance Be careful with the language you use when filing a claim Have an independent representative investigate your denial Seek legal recourse – but more difficult than before Be aware that there is a possibility that
He said you can start by searching for an insurance company on the Weiss Ratings website and see information such as the company’s rating score and denial rate to help you decide which one to choose.
He suggested that when filing a claim, be careful to avoid language that could be taken out of context and lead to an outright denial of the claim.
If a claim is filed and denied, the consumer can have an independent representative representing multiple companies determine whether the claim is meritorious.
“If, with the help of an agent, you determine that it is a legitimate claim and it is denied outright, unfortunately your only recourse is to take legal action,” Weiss explained. .
This is not unusual. According to the National Association of Insurance Commissioners, Florida had 18 times as many home insurance lawsuits last year as any other state. But Weiss cautioned that this option could be more time-consuming and expensive because of the new law.
“We look forward to putting pressure on the Florida Legislature, other states, and insurance regulators to take steps to fix the problem. In my opinion, the first step is , strengthen information disclosure to consumers so that they can make informed decisions based on clear, accurate, publicly available data rather than hidden facts. We can,” Weiss said.
Weiss Ratings is an independent rating agency for financial institutions and insurance companies. Founded in 1971, the company is headquartered in Palm Beach Gardens, Florida.
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