SLABBED welcomes Texas Windstorm Association and Ike victims to “the scheme”
Texas Windstorm Insurance (TWIC) has canned software programs that the Adjusters have to use for their estimates. The unit prices on the structures are about 40% low, old and outdated. The adjusters make choices on which unit price item to use and that usualy makes the estimate also low. Drawings must be made by registered Professional Engineers in the State of Texas. The engineer designs to the new codes but the costs in the software programs are not updated…
This gem of information was among the 74 comments to the Houston Chronicle’s story Homeowners battle for higher payouts to fix Ike damage.
Hurricane Ike blew some shingles off William Cognata’s La Porte home and loosened a lot more.
His roofer told him he needed to replace it, but his insurer offered $466 for repairs.
“Three roofers looked at it and told me to replace it. I’m no roofer, but I have some sense to know who to listen to,” he said.
Area homeowners have survived the storm, waited weeks in some cases for the lights to come back on and opened their homes to insurance adjusters.
Now, as residents slammed by Ike work their way through the recovery process, some are entering a new phase: the battle for what they consider a fair settlement of their claims.
Some are complaining to regulators, hiring their own experts and, like Cognata, turning to attorneys to get higher insurance payouts.
More than 1,700 Texans so far have complained to the state about their insurance companies — everything from claims delays to unsatisfactory offers and denials.
That’s a small percentage of the more than 530,000 claims filed already in the wake of Hurricane Ike, but state regulators say they’re monitoring the number of reports and how they’re resolved to make sure policyholders are treated fairly. The agency can require bigger payments if necessary.
“We certainly want to hear if there are any complaints about the claims process,” said Jerry Hagins, a spokesman for the Texas Department of Insurance.
Perhaps, Mr. Hagins will read the comments like this one in the Chronicle.
Only because most people are still waiting for the news of their meager pittance check! I’m calling the Texas Dept of Insurance today! Although I bet they get gifts and perks from the Insurance companies and will give us a deaf ear!
I finally received an insurance check this week for less than 40% of the three bids I’ve obtained. Now I find that Wells Fargo wants the check! They want to send out their inspectors and piece meal payments as the work gets done.
Who knows how many more weeks this will back-up repairs to my leaking cold home! My General Contractor left me when he heard this news! Still have a hole in my roof and no place to put a Christmas tree for my babies! My wife is in tears and I’m losing it! Houston is being neglected! HELP!
Imagine what state he and his family would be in if they were among the 800 Mississippi families still living in a hotel – spending their fourth Christmas since Katrina without a home.
Cognata argues his insurance company should pay to replace the roof. The shingles can be lifted up by hand, some with creases at the top, something his roofer says can’t be repaired.
Getting nowhere on his own, Cognata has hired an attorney.
“You’d think they’d go ahead and do it to … prevent a $50,000 or $60,000 claim next year,” Cognata said. “This is nothing but $5,000 or $6,000.”
Allstate declined to comment on the specific claim, but spokesman Bill Mellander said the company sends experienced experts to assess damage and is confident in their accuracy.
“But above and beyond that, if there are disputes, if there are differences in opinions with regards to the nature of the estimate, we are committed to sitting down with the contractor and customer to identify if mistakes have been made or if reasonable ground can be reached,” Mellander said
Several readers responded to Mr. Mellander’s comment.
ALLSTATE are the worst crooks of them all; I just waiting on a class action lawsuit to join. Bill Mellander is a liar when he reportged they send experienced experts to assess damage and is confident in their accuracy. The fool that came to my house after IKE claimed he didn’t have his roofing boots so he couldn’t inspect the entire roof.
An occasional comment acknowledged an insurer providing satisfactory service – this one followed the one above.
I am not here to complain but rather to compliment my insurance company-Safeco. A week after the storm, the first adjuster refused to give me anything for my leaking roof as I had no missing shingles. I asked for a different adjuster and they sent one last month. I had my roofer here-Ideal Roofing-to meet the adjuster. I asked them to use my leaf blower on the roof to show just how loose the shingles were. Safeco gave me full credit for it and now I have a new roof. The first check only covered about 25% of the claim. I submitted all of the paperwork required in the form of receipts and I got the final check last week. I am glad I am not covered by Allstate.
The Chronicle reports homeowners aren’t disagreeing only with private insurers.
Michael Amoroso of Dickinson says the $33,100 the National Flood Insurance Program offered after Ike cracked the foundation of his home will barely cover repairs.
Blue tape dots his home, marking cracks in tiles and wallboard. A line on the wall shows where more than 2 feet of water flooded the home, which Amoroso had just finished renovating in August. He spent $1,500 on an engineer, and also hired a public adjuster who estimated the damage at $160,000.
“It cost money, but there’s no way I can accept their offer,” said Amoroso, who expects to have to raze his house. “For this, it’s just too low.”
A spokesman for the federal flood program couldn’t talk about the specific claim but said it would take a second look.
Chip Merlin, an attorney whose firm represents policyholders, said private companies handling claims on behalf of the flood program may be reluctant to make high offers. That’s because overpayments could come out of their pockets. (emphasis added)
After Hurricane Katrina, Merlin said, adjusters were paying out on flood claims and giving the benefit of the doubt.
“Now, for the first time, we’re getting calls about national flood not paying enough,” Merlin said. “Adjusters are taking a little bit longer, not paying quite as freely, and we think that’s because the independent contractors will be responsible for any overpayment.”
The National Underwriter is definitely keeping an eye on Merlin.
This weekend, the law firm of Merlin Law Group will hold an event at the Almeda Mall in Houston where attorneys will be on-hand to review consumer’s insurance policies and explain to them what their policy covers and what to expect in a settlement…
Brian Martin and Congressman Taylor are, no doubt, keeping an eye on FEMA – and hopefully, given Merlin’s comment and the agency’s differing view below, Brian will clarify the FEMA policy on overpayments for SLABBED readers.
But the flood insurance program had held companies responsible for overpayments even before Katrina, said Butch Kinerney, a spokesman for the Federal Emergency Management Agency.
FEMA, which oversees the federal flood program, has seen no widespread issues or problems from Ike, Kinerney said.
According to the Chronicle, even state-created insurance programs are giving policyholders fits.
When the Texas Windstorm Insurance Association declined to send an engineer out to his home, Tom O’Brien hired an engineer and an attorney to help get more than the $43,000 offered by the association so far.
“It’s been hard to deal with this for the last two months,” he said.
O’Brien, who has been remodeling and selling houses for the past six years, estimated it would cost at least $100,000 to repair a hole in the roof above his bedroom, bricks blown out of two different walls, cracks in his walls, and structural damage that occurred as his roof shifted.
A claims consultant said O’Brien’s house in Dickinson would be too costly to repair and should be rebuilt from scratch.
Jim Oliver, director of the windstorm association, would say only that the adjuster’s report didn’t indicate an engineer was required. He said the association would ask O’Brien to submit an estimate from a contractor and work with the adjuster to determine if more needs to be paid.
A larger payout would be welcome, but O’Brien shouldn’t have to jump through so many hoops, said Javier Delgado, an attorney he hired on a contingency basis.
“No homeowner should have to hire their own experts. That’s the duty of the insurance company,” he said. “They’re supposed to act in good faith and hire the experts if an expert is needed.”
I might have been surprised to learn of O’Brien’s difficulty had my websearch not turned up this story on the Protecting America site praising action by the Texas House Insurance Committee to consider legislation that would create the “Texas Natural Disaster Catastrophe Fund.
“The U.S. Congress and state legislatures across the country are recognizing the harsh reality that massive natural catastrophes have struck before and will strike again. The House Insurance Committee’s action today is putting Texas at the forefront of resolving a pressing national priority,” said Robert W. Porter, executive director of ProtectingAmerica.org, a national non-profit organization dedicated to finding better ways to prepare and protect American families from natural catastrophes.
Not the change we need - and little reason to wonder why.
ProtectingAmerica.org is a non-profit organization that is co-chaired by James Lee Witt, the former director of the Federal Emergency Management Agency (FEMA).
blockquote>
On a positive note, residents of one Texas neighborhood are working to help one another and other victims, too, and have set up a blog for the exchange of information at http://ikeandinsurance.blogspot.com/ Words of encouragement, I’m certain, will be welcome along with any tips Katrina victims have to share.
NFIP claims guidance for Gustav & Ike:
http://bsa.nfipstat.com/wyobull/w-08070.pdf
Claim Adjusters:
A. Must address prior losses, particularly from Hurricanes Katrina and Rita.
B. Where possible, should separate, itemize, and document the damages from each hurricane.
C. Must recognize and avoid duplication of coverage and payment for overlapping damage from prior losses or Hurricanes Gustav and Ike.
D. Should use proven investigative methods to document windstorm damage to building or contents. See WYO Bulletin W-08008, dated February 25, 2008, for a discussion of Wind/Water Investigative Tips.
In approaching a flood claim that may also include wind damage, an adjuster should continue to recognize any excluded damages. If there is wind and flood damage, the adjuster should comment on the rationale of his/her decision regarding the separation of wind and flood damage. Most of the time this is simple – water line and below is flood; above the waterline is wind. However, when a building has been heavily damaged or destroyed by storm forces, an engineer may be needed to determine causation. Adjusters should photograph the wind damage generally. Photos of wind damage do not have to be exhaustive, unless necessary to document that flood damage is minor or absent.
Brian Martin
December 5, 2008 at 10:50 am
Thanks, Brian, is it the adjusters that are going to have to reimburse overpayment? Merlin was saying this was not the case with Katrina but the FEMA/NFIP position differed.
One other point, it seems to be painting with too broad a brush to say the waterline excludes prior wind damage. I can think of situations where the water would just add insult to injury from wind damage.
nowdoucit
December 5, 2008 at 10:57 am
Another smoking gun!!! The NFIP version of the WindWater Protocol. I suggest immediate class action lawsuits against all federal government employees that have any jurisdiction or control of FEMA and the NFIP. Starting with all congressmen!!! Kinda makes ya wonder dont it???
Yeah yeah, Proximo is back in town let the games begin!
Proximo
December 5, 2008 at 11:08 am
Proximo is back and as dense as ever.
This is nothing like the Wind/Water Protocol. NFIP is not saying to bill the wind policy for flood damage.
This is NFIP trying to do what it should have done with Katrina claims – make the insurers acknowledge and account for wind damage in the flood claims file.
After Katrina, NFIP’s Expedited Procedures Memo gave insurers a blank check to pay flood claims based on the FEMA surge/flood data without examining the property. The memo also promised that the insurers would not be liable for any overpayments based on the FEMA data.
Brian Martin
December 5, 2008 at 11:24 am
Nowdy,
I agree that NFIP should not preclude wind or wind-driven debris damage below the waterline. This is still much better than the Katrina claims guidance.
Brian Martin
December 5, 2008 at 11:40 am
I haven’t seen anything that says the adjusters themselves are liable for overpayments.
I think there are fewer cases where the WYO flood carrier is also the wind insurer, so there are fewer cases where the flood adjuster has a conflict of interest.
With separate wind and flood adjusters, they are supposed to coordinate the claim to ensure that the homeowner does not collect a windfall (not very likely) and supposedly to prevent the adjusters from underpaying by each blaming the other peril (more likely). If the wind insurer is balking on making a determination, that might delay the flood adjuster from closing out the claim.
Brian Martin
December 5, 2008 at 11:59 am
Hey, any moron can put the wwp and this NFIP directive side by side and they almost match up EXACTLY in purpose. They were both designed to do the same thing from what I can see: give the adjusters guidance on how to separate damage. As I mentioned in an earlier post, I think the policyholders wont be too damn happy waiting months or years for the exact determination of their damages and exactly apportioning the damage claim to the proper company or entity.
The expedited procedures that everyone alleges was cooked up solely by the insurers probably took MONTHS off of your people’s waiting on money to start rebuilding their lives. I wouldnt wish it upon anyone but if the coast had gotten another storm like Katrina and the insurers sat on their hands until NFIP had settled the flood issue, what type of crapstorm would your coast be in today? Everyone wants precision and nobody “dumping” on anyone else but the plain simple truth of the matter is that when there is not a helluva lot to look at to discern PRECISELY how much is owed, it will ALWAYS be guesstimated and the insurers rightly or wrongly decided to err on the side of pumping money out SOONER RATHER THAN LATER. If the next time they decide NOT TO DO THIS (as what is apparently happening in Texas,) you see how people feel about it. Brian, you can say Dense all you want, I run a business with more employees than you will probably ever manage in your lifetime. People that throw wild allegations and are in pseudo-positions of infulencing policy that affects an entire nation scare the hell out of me and my cohorts. I dont lap at the heels of a political flunky that cant even get the respect of his own party for his initiatives.
Proximo
December 5, 2008 at 12:16 pm
I can tell it’s frisky Friday; so, let’s focus on the expedited policies. A logical policy with the interest of the policyholders and taxpayers considered would have expedited the claims of those who held only a flood policy. Instead, the expedited policy totally ignored the wind/water issue and focused on the most expensive claims that draining the flood program wouldn’t provide enough to rebuild. Consequently, those who owned the uninhabitable property filled whatever housing was available at whatever price while waiting to resolve and obtain payment for wind damage so they could rebuild. That left the people who had only coverage for flood damage, if that, without affordable housing. Some 800 were still in hotels at last count, Proximo.
I’ve only owned small businesses but success in all sizes could not survive with less than the business needs to produce what it sells – and families are the same way. A half-ass policy that generates a half-ass payment will only rebuild a half-ass house. Consequently, our once beautiful coast is slab after slab after slab – sometimes extending blocks off the beach. We’ve got one glorious mess. Come see us Proximo and you’ll be just as angry – and I bet you can figure out how they could have done it better than singing the same song, second verse in Texas.
nowdoucit
December 5, 2008 at 12:52 pm
The wind/water protocol said that State Farm will not pay for any wind damage where there also was water damage.
NFIP is saying show us whether there also is wind damage and explain how you distinguished between the two.
Even you can see those are opposites.
It did not help policyholders that they did not receive the wind insurance payments they were owed.
That is what the wind/water protocol did and that is why the insurers wanted the NFIP expedited procedures.
Your argument is premised on the industry’s strategic assumption that people would rather have half of what they are owned sooner if we make them go through hell to try to get what they are really owed.
Our proposal solves the problem by covering wind and flood in one policy. Then the only issue is the amount of the loss and there are no opportunities for intentionally delaying claims over causation disputes.
Brian Martin
December 5, 2008 at 12:42 pm
I’m almost done with my “treat” so hang around for this wind/water case…I’ll catch up on my reading and responding when I’m done and get it up.
nowdoucit
December 5, 2008 at 1:52 pm
I think we need to bring back Gene’s Bill—
The typical homeowners wind policy does not afford wind coverage when rising water is present. No insurance product exist which provides this wind/water protection which occurs in every tropical storm and hurricane. This puts the majority of our nations infrastructure at risk of total loss without private sector insurance participation in the rebuilding efforts. The current insurance model makes no provisions for responsible consumers to prepare in advance for over 50 percent of the total catastrophe losses which occur each year.
Congress is currently debating the passage of HR 3121: The Flood Insurance Modernization Act which for the first time affords responsible consumers the insurance vehicle to pre-pay for wind/water loses. The private insurance industry does not provide coverage for such wind loses, yet some courts have required them to provide payments to consumers despite having never collected premiums for such damage. Industry cannot afford to become the insurer of last resort for such catastrophic loses as they do not collect premiums for such damages. If allowd to continue this problem could result in the total failure of the entire insurance industry.
HR 3121 removes the burden for CAT damage remediation from the tax payers, banks and private insurance carriers. HR 3121 shifts the burden from tax payers, banks and private insurance carriers to the consumer. It ends the federal governments role as unpaid insurer of wind/water damage. It allows the federal government and banks to require irresponsible homeowners to pre-pay for CAT loses in advance I support this measure because as a tax payer I believe it the responsibility of each homeowner to assume the risk for their own home.
Steve
December 6, 2008 at 11:06 pm
Agree, Steve. Someone needs to factor in the impact of these cases on the budgets of the courts, too. That’s another savings from Gene’s bill.
nowdoucit
December 6, 2008 at 11:15 pm
Time for insurance firms to respond to Ike victims
People who pay premiums have a right to expect relief
By PAUL BERGER
http://www.chron.com/disp/story.mpl/editorial/outlook/6156338.html
Brian Martin
December 10, 2008 at 10:48 am
The stories just keep pouring into my office about the mishandled claims and mishaps about Hurricane Ike. I’m not sure about how this all came about. Galveston, one of the toughest hit areas, have people reeling from not having flood insurance. Yeah, TWIA is not going to cover the storm surge. It was not covered in the Katrina or Rita. Would it be that those people in Galveston needed a better agent to explain what would be covered and not covered in the event of a peril. I’m not sure but I do know one thing. Many people are getting a long hard lesson on windstorm and flood insurance. The counties which will be affected in the years to come should be better educated on their plans in place. For the latest and up to date information please feel free to call me at my office.
Clinton D. Richey
800-776-0633
http://www.txwindstorminsurance.com
copyright 2008
Clinton D. Richey
December 22, 2008 at 7:15 pm
Welcome to Slabbed, Mr. Richey.
I spent my preschool years in Harlingen and have followed Ike and the claims handling following. It’s been a while since I’ve visited your website but I’ll check again as soon as I can.
I trust by now you have posted your methodology for accounting for wind damage to flooded property and hope you’ve had time to read the latest decision from the 5th posted earlier this evening. “For the latest and up to date information” on wind v water, please feel free to check here. You’ll probably find some stories on mishandled claims, too, that will help you figure out what really has people reeling from Mississippi to Texas.
Thanks for stopping by and leaving your number.
Nowdy
nowdoucit
December 22, 2008 at 9:45 pm
I would like to know if anyone who had just a “slab” left in the Gilchrist and Crystal Beach area received anything else from Texas Windstorm besides the 10% of dwelling and 5% of the contents they were fronting everyone.
Tanya Sandifer
January 18, 2009 at 8:42 am
Make a note of corrected email address
Tanya Sandifer
January 18, 2009 at 8:44 am
Tanya it was roughly around this time in 2006 when the Mississippi Wind Pool had geared their claims staffs to the point where the policies were paid in great numbers after Katrina.
IMHO our insurer of last resort did the proper thing when they paid by tendering their policies on their slab claims for the structural limits at the minimum.
We’ll check around to see what we can find out from your windpool.
sop
sop81_1
January 18, 2009 at 12:30 pm
I also received the 10% from Tx Windstorm hoping that somehow they will see the light and do the right thing. I had a total loss. My home was on Gilchrist which took the direct hit. I’m still wondering if I shoud respond to the many ,many letters that I have received from attorneys and file a lawsuit. Afterall what do I have to loose. I just think it’s a shame that I would have to go through all that to just get what is owed to me. I turned in the paperwork for a buy out from Galveston county still not knowing if that is the right thing to do. Should I file a lawsuit or should I take a buy out and are they somehow affiliated with one another.
Confused
June 6, 2010 at 7:30 pm
Confused we have not covered the Ike litigation in depth so we’re not qualified to address your specific questions.
Luckily for you there is an organization that was founded to help people in your position, United Policyholders who can help you sort through the issues with your impasse with the TWIA. You can contact them via email here. UP’s executive director, Amy Bach, is a friend to this blog.
Good luck and keep us posted on your progress. TWIA is a mess in Texas no doubt.
sop
sop81_1
June 7, 2010 at 7:54 am