Consumer Advocate: New Trick from
Insurance Companies doesn't Treat Consumers Fairly
10/30/2012
The Miami Herald
Thankfully for Floridians, Hurricane Sandy skipped the
Sunshine State. But that hasn't stopped insurance
companies from giving Florida homeowners the run-around,
according to Florida’s insurance consumer advocate.
Robin Westcott penned a letter to Insurance Commissioner
Kevin McCarty highlighting a new anti-consumer trend has
emerged among the state’s property insurers.
After a homeowner submits a claim, the insurance company
digs into the homeowner’s financial past to find
evidence of a bankruptcy, lien, or foreclosure. If the
homeowner has such a blemish on their credit history,
the insurance company finds that the customer was never
eligible for coverage, and then drops them, without
covering their claim.
“This activity threatens not only homeowners’ financial
stability but also the state’s economic recovery,” wrote
Westcott, calling the practice “potentially unlawful”
and “abusive.”
According to Westcott, several homeowners are being
dropped from coverage after they file a claim, despite
paying premiums to their insurers for years.
The insurance companies wait until the homeowner files a
claim before dropping them due to ineligibility.
Westcott letter points out that Universal Property and
Casualty Insurance Company is one of the insurers
involved in the practice.
“This is a real-life Halloween trick that does not treat
consumers fairly. We must give consumers relief from
this game of ‘gottcha’,” Westcott wrote.
She has asked McCarty to investigate.
