Residents learn about insurance realities

People buy insurance to protect themselves from financial loss if the unexpected happens.

On Aug. 29, 2021, the unexpected happened. Hurricane Ida left thousands of Southeast Louisiana residents depending on the homeowner's and flood insurance policies they have paid into for years to help them in their time of need.

Now some are learning the hard way that getting everything they believe they are entitled to can require fighting for it.

Over 40 Hammond residents gathered last week at the Tangipahoa African American Heritage Museum to learn more about their responsibilities and rights regarding insurance and FEMA claims. Apostle Alon Frazier, founder and pastor of True Faith Outreach Ministries, hosted this town hall style event. Bruce Copeland, a qualified federal expert on disaster property damage spoke to the group, and retired Judge Harry Cantrell shared his experiences.

"When a disaster hits, somebody's got to lose," Copeland said. "Our community continues to lose over and over and over."

Fearing their policies will be cancelled, people would rather go into their savings and get an SBA loan instead of fighting to get the insurance companies to pay them what they are owed, he said.

"The first thing we have to understand... this is a business," Copeland said. "It is the first guy's job to be nice to you, promise you the world and build your hopes up because when disaster strikes, hope is the only thing you have left. The adjuster's job is to keep you on the hook till they get people out to get all the documents they need."

In an interview with The Daily Star on Monday, state Insurance Commissioner Jim Donelon suggested that policy holders use their agents to initiate their claims. A policy holder's professional insurance agent can understand and explain what is covered and what is not, he said.

An insurance policy is a contract, and policyholders can bounce questions off their insurance agent before taking a disagreement to a lawyer, Donelon said.

Also, the insurance commission is always available to field complaints against companies not handling policy holder claims in satisfactory matters, he said. The commission might not always agree with the policyholder, but most of the time they find the basis for disagreement and many times resolve it themselves.

"In anticipation of 600,000 to 700,000 claims for Hurricane Ida, we have set up for voluntary mediation plan last week," he said.

The voluntary mediation plan can be reached at 800-259-5300 or ldi.la.gov.

Copeland told his audience last week the way for homeowners to "win" can be found in section 1 conditions in the policy book.

"Section 1 conditions in the policy book are literally the contract language that says if this happens, you must do this, if you disagree, you must do this," he explained. "It tells you literally what your rights and responsibilities are."

The sometimes 80-page policy books can be confusing, he said, and people may become convinced it is their fault they are receiving less money than they are owed.

Residents then put a ceiling on their own repairs, and instead of asking the insurance company to give them more money for repairs, they will get someone to do the work cheaper. No one is asking the insurance company for more money, he said.

Cantrell, a retired magistrate justice from New Orleans, spoke about his personal experience of evacuating to Florida when lights started flickering for Hurricane Ida. He came back and filed a claim with the insurance company.

He said he asked his insurance agent how much money they were entitled to for food on a daily basis but received no answer. After checking with a manager, he learned he and his wife would be entitled to $50 dollars a day each for food expenses.

He also asked about evacuation reimbursement which had added up, and he checked with the manager. With a chart showing lights went out in New Orleans on Aug. 29 and came back eight days later, he learned he would be reimbursed for expenses during that time.

"If I had never asked about it, if I had never read about it, he wasn't going to volunteer that," Cantrell said.

Copeland encouraged residents to take advantage of Louisiana's updated laws and a supreme court ruling that forces the insurance companies to face double damages plus attorney fees if they draw out the process.

Sadly, many people rely on promises instead of reading what they have signed, Copeland said.

"We can't change what you've done to yourself. It's hard to change what you've already told them," he said.

As for contents lost, he said each type of item depreciates at a different rate. A tile floor depreciates at a different rate than the drywall and the light fixture, for example. To ensure all funds are accurately received, he stressed that residents need to accurately record contents in detail room by room, line item by line item.

Commissioner Donelon said two essential things for policy owners to do are photograph everything and report damages as a claim to the insurer.