Florida’s Citizens Property Insurance Corporation Goes to War Against Its Policyholders
Since the last serious hurricane seasons of the mid-2000s, Citizens Insurance Corporation has spent $2.7 billion in legal fees in litigation against its own policyholders. Furthermore the Florida Legislature has given Citizen’s a free pass to abuse its customers. Citizens was granted immunity from the bad faith laws, which are supposed to protect the consumer against the insurance company’s deliberate poor treatment, delay in claim payments, ambiguous or misleading language and reasoning in order to deny or delay a claim.
This means that even though Citizens commits bad faith to deny their customers’ claims, they cannot be sued for bad faith. Translation: while Citizen’s is busy raising their rates as quickly as the law allows, they are lowering their customers’ coverage options. To illustrate, screened enclosures, sheds and fences are no longer covered. And they have lowered the limit on tile replacement for cosmetic damages to $10,000.
Another abuse: Citizens refuses to cover its policyholders if they have hidden or visible water damage that occurs for more than two weeks. And now they are tampering with your rights to go to appraisal (dispute resolution). Citizens Insurance Corporation actions are forcing their policyholders to get involved in lengthy litigation in the already overburdened Florida court system. What is next? Removal of insurance coverage for water or fire damages?
With very few insurance companies willing to write wind/hurricane or homeowners coverage in South Florida, they are stripping Citizens of important coverage, and raising your rates. While the State of Florida has limited property insurance rate increases to 10% per year, the corporation’s new president and CEO Barry Gilway met with Florida Governor Rick Scott and his cabinet last week to make clear that Citizens needs to increase their rates. He also promised that the insurer will charge higher rates for less coverage in order to encourage customers to buy elsewhere.
While the Governor repeatedly claims to be on the side of the insured, he then told reporters out of the other side of his mouth that Citizen’s policyholders were going to get “socked with huge assessments in the event of a major storm” and that Florida property insurance policyholders need to know that the premiums they’ve paid are merely down payments. Their examples are based on a 100 year storm hitting Florida and destroying all residential and commercial properties in Florida. The chance of this happening is one percent! Aren’t you tired of all their fear mongering?