|Date:||November 02, 2016|
|Source:||Palm Beach Post|
Regulators have not always found big rate hikes justified for 2017, but thousands living in older South Florida homes face limits on the costliest category of claims not caused by storms — water damage such as from a plumbing leak.
Don’t count on getting more than $10,000 of damage covered if your home is at least 40 years old and insured by Heritage Property & Casualty Insurance Co. It grew into one of Florida’s five largest insurers mostly by taking customers from state-run Citizens Property Insurance Corp.
The cap is noted in Heritage’s rate filing approved to take effect Dec. 15.
The filing shows regulators approved an overall 9.9 percent rate increase for standard home policies and 15 percent in Palm Beach County. That was down from a higher request — 14.9 percent statewide and 25 percent in the county — that Heritage withdrew after scrutiny in The Palm Beach Post and questions from regulators.
“The original filing did not have sufficient support for the proposed changes by territory and the overall impact,” said Amy Bogner, spokeswoman for the state’s Office of Insurance Regulation. “The company provided additional information to support the proposed changes in the revised filing.”
Another top-five Florida insurer, Universal Property & Casualty Insurance Co, withdrew a proposed blanket 8.1 percent hike in South Florida and said it did not plan to refile.
Heritage covers more than 43,000 homes that are at at least four decades old, documents show. The limit on water claims applies to older homes in the fourth year after a Citizens takeout, records show.
The company’s chief executive said the move was necessary because of inflated and abusive claims, particularly those where contractors or other third parties ask consumers to sign over control of insurance benefits. Some contractors refuse to get started unless a consumer signs such a form, which can be a harried choice ankle-deep in water at 3 a.m.
“Assignment of benefit fraud, particularly as it relates to water claims, is the largest instance of insurance fraud in the homeowners market in the history of Florida,” Heritage CEO Bruce Lucas told The Post. “Citizens insurance has been very vocal about the increase in water fraud particularly in the Tri-County for the past three years. The Palm Beach Post has reported on this topic on numerous occasions. It not surprising that homeowners rates are going higher, and I predict rates to increase an additional 30 percent to 50 percent in the next three years in the Tri-County unless the legislature passes comprehensive assignment of benefit reform this session.”
Lucas continued, “I strongly urge all homeowners to contact their state representatives and senators to voice their concern about assignment of benefit fraud and what it is doing to their homeowners’ rates.”
Some contractors, attorneys and their allies argue insurers want to wriggle out of paying full and fair amounts for damage, which doesn’t always conveniently stop at $10,0000 when water floods a home. Attempts to restrict such claims have mostly failed in the courts and the legislature in recent years.
Attorney Lee Jacobson said at a forum in Boca Raton in June that insurers are “crying wolf” in a bid to force changes in laws and regulations and bolster profits.