Thanks to a dubious move by People’s Trust Insurance Co., thousands of South Florida hurricane coverage policies have been dropped and could have South Florida homeowners facing hurricane season without adequate a homeowners insurance coverage. The company recently purged a huge chunk of its policies, leaving homeowners scrambling to find other options.
The justification provided by People’s Trust for dropping so many policyholders was that the move reflected “prudent exposure management.” This ambiguous phrasing essentially means that the company had issued too many policies. In the event of a disastrous hurricane in south Florida, the insurance company would be left issuing payouts to a large number of its own policyholders.
Even if you’re unfamiliar with the specific ins and outs of disaster insurance, you can probably identify the hypocrisy in such a move. The major reason people buy disaster insurance is that it affords a certain degree of security for homeowners in disaster prone areas. It only makes sense to have disaster insurance if it covers you during the times in which a disaster — in this case a hurricane — is the most likely to occur.
People’s Trust has essentially admitted that it doesn’t want to be stuck issuing payouts to its clients — which is, ultimately, the whole reason the company exists in the first place. It has chosen to instead get rid of risky policies, leaving many of its now-former customers without reliable insurance during one of the riskiest times of year.
Scrambling for cover
With hurricane season just around the corner, around 5,000 former People’s Trust policyholders have now found themselves exposed to the elements. Those left without hurricane coverage could potentially lose everything in the event of a hurricane. Or, they could find that in their rush to secure coverage with another insurer due to the fact that they must do so within 60 days, they haven’t selected the right policy for them. Both scenarios could prove disastrous for homeowners.
What’s even worse is the precedent this type of practice establishes. The state of Florida allows insurance companies to drop clients for “underwriting reasons” within 90 days of the start of the policy. What is specifically meant by the phrase “underwriting reasons” is left largely undefined, which means companies can drop their clients for essentially any reason — real or invented. Should other insurance companies follow in this example, more Florida homeowners may find themselves losing their insurance policies at times when they need them the most.
If you’re dealing with issues related to People’s Trust or any other insurance company in Florida, call on a public adjuster. These professionals know the insurance industry well, and can help you examine your policy to make sure you have hurricane coverage. If you do need to file an insurance claim, a public adjuster can help you through the process.
Advocate Claims Public Adjusters serves home and business owners across Florida, including Boca Raton, Delray Beach, Fort Lauderdale, Hollywood and West Palm Beach. Call us today at 1-954-369-0573 or contact us online.