June 13--It's the topic of the season in the insurance world. It pits insurance companies against contractors, attorneys and other third parties they blame for inflating non-storm claims such as plumbing leaks. Caught in the middle, consumers often find themselves ankle deep in water and up to their necks in unexpected strife.
The Troubled Waters forum is coming to Palm Beach County on Tuesday.
State insurance consumer advocate Sha'Ron James aims to call together the various parties to find answers on an issue that insurers blame for driving up rates in South Florida -- even without a hurricane for more than a decade.
It's a tricky situation for consumers. When a pipe bursts and floods a home, the frazzled homeowner may scramble to find a contractor to clean it up. That contractor may require the homeowner to sign over control of insurance benefits. It sounds routine enough, and besides, who has time to ask a lot of questions or shop around when there's water all over the place?
But insurers say that's when a lot of the trouble starts, because contractors can submit what insurance companies consider to be unjustified and abusive bills for clean-up, repair and restoration work that can run into the tens of thousands of dollars. Depending on the contract language, contractors can even threaten to charge the consumer for the balance if the insurer balks, insurers say. Sometimes the contractors are tied to attorneys who take cases to court, introducing yet more costs that ultimately drive up everyone's rates, the insurance industry's argument goes.
For their part, attorneys and contractors say insurers are trying to low-ball consumers and unduly restrict their rights. For example, doctors routinely ask patients to sign over control of insurance benefits, they say. And they've been mostly winning in the legislature and the courts.
Certainly most consumers don't want their rates to go up because of unnecessary or inflated costs for somebody else's claim down the street. They just want claims covered in a reasonable and timely way. On other hand, they don't want insurers using a lot of fuss about water losses as a cover story to raise rates without clear justification.
Heritage Property & Casualty Insurance Co. is asking for rate increases up to 25 percent in Palm Beach County, and an average 14.9 percent statewide, though its claim losses compared to premiums have been going down, not up, The Palm Beach Post reported.
The forum is open to the public from 9 a.m. to 4 p.m. Tuesday at Florida Atlantic University's Stadium Recruiting Room in Boca Raton.
Confirmed presenters are said to include: The Florida Office of Insurance Regulation, the National Insurance Crime Bureau, the American Insurance Association, the Florida Justice Association, the Florida Association of Insurance Reform, as well as the Florida Association of Insurance Agents, Florida Association of Restoration Specialists, and more.
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