Sen. Blumenthal to Insurance Industry: Crumbling Foundation Insurance Policies May Violate Law
In an exchange during a Senate Subcommittee on Consumer Protection, Product Safety, Insurance, and Data Security hearing on Insurance Fraud,
"I want to talk about an issue that is of grave concern to
Few in this room would know how to spell it and not many around the country would know it, but it is well known in
Instead of alerting their consumers to the risks once the insurers became aware of them, insurers surreptitiously updated their policies. They updated their policies to strictly define the coverage of collapse to only abrupt collapse, and they added foundations to the list of policy exclusions. They never properly told their customers what they were doing. They never told them the reason they were doing it. They never adequately notified them so the homeowners could take steps to protect themselves either by rebuilding or taking construction precautions with their foundations, or taking new policies that covered this problem. Insurers clearly knew there was a problem with crumbling foundations before homeowners knew, and they immediately sought to shield their liability--in other words, protect themselves rather than protect their customers."
Video of
Panel witnesses included:
The Honorable
Mr.
Mr.
Mr.
Ms.
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