New Scheme by Insurance Companies
is 'Abusive,' says State Consumer Advocate
Tampa Bay Times
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.
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.