Posted on 03/31/2006 4:10:32 AM PST by WKB
There is a rising tide of court battles over Hurricane Katrina damage. Homeowners versus their insurance providers. Wind versus water. Now some "whistle-blowers" claim to have proof insurance companies altered damage reports to deny coverage.
August 29th...a storm with record tidal surge. Katrina blasted the scenic Mississippi Gulf Coast. 7 months later..blue roofs..white boxes... and a raging debate.Was it Katrina's violent winds or tsunami-like storm surge that decimated the coast? The language of hurricane insurance policies is being challanged in the courts. " This is a battle I don't want to fight." Richard Scruggs is a high-powered, enormously successful plaintiff's lawyer . He tells us, "The companies should have done the right thing." Scruggs is taking on insurance giants who refuse to pay up on claims. "It involves billions of dollars." Scruggs, who took on big tobacco companies also claims to have whistleblowers in this case. "The insiders are very highly placed..people within the company." Insurance insiders reportedly squealing on questionable policies. We asked Scruggs if he had proof. " Specifically have you seen altered documents?" His reply, "Yes."
We obtained copies of those conflicting engineering reports. That damage report was about a home destroyed 13 miles inland. A Kiln couple is suing State Farm . Terri Mullins says she and her husband are very upset. The first report in October concluded the cause of damage was due to hurricane force winds. But a second report emerges this January. The conclusion: minimal obvious wind damage consistent with rising water. William Mullins told us, " They flat out told us , you weren't supposed to get that first report and they acted almost appalled we had a copy and asked how we got it." State Farm used the second report and storm surge as the basis for not paying the Mullins claim. According to The Katrina Groups attorneys and Mr. Scruggs, "First report says wind, company doesn't like it, shred it deep six it..don't pay it..get a second report..by the same engineering from that says what the want it to say. The Director of the Insurance Information Institute, Bob Bailey told the Insurance Journal Daily Scruggs should quote "put up or shut up." He says insurance companies in question should, "insist on a subpoena in which Scruggs will have to come forward and not only name his whistleblower but bring him in."
Another coast couple is also crying foul. Their first engineering report blamed wind damage. Later a second report was issued. Gulfport homeowner, Dr. Hubert Smith's attorney talked about the second document issued. "It said the house was racked and severely damaged by storm surge, totally different." Their lawyer claims Rimkus Consuling altered documents and forged the inspectors signature on the storm surge report. A Rimkus official told us he has not received a copy of the lawsuit and could not comment. Meanwhile, the Gulfport homeowner said he did get an offer from his insurance carrier. "They did send me, excuse me, $9,000 to put on a $30,000 roof." $9000 on a half million dollar policy.
Insurance companies deny any form of deception. Investigators for the Attorney General are particularly interested seeking engineering reports as part of a criminal review. Attorney General Jim Hood said there is a specific statute addressing the matter. "The operative term is fraudulent denial of claims. And if the law is broken , Hood issued this warning. "Anybody involved, engineers adjusters will go to the pen. It's not going to be probation if I can send them to the pen."
Some call it a David and Goliath showdown, with the fabric of the gulf coast and billions of dollars at stake. State Farm and other insurers vehemently deny that they are liable for the damages caused by water. State Insurance Commissioner George Dale agrees. U.S. Senator Trent Lott, who lost his waterfront home says a congressional investigation is warranted.
Mississippi ping
Correct me if I am wrong, but the storm surge was caused by the wind wasn't it? The wind seems to be the "root cause" of the damage. Without it, no surge.
As Ron White said, "It isn't THAT the wind is blowing, it's WHAT the wind is blowing!"
This whole thing leaves a very bad taste in my mouth.
I firmly believe that those that lived in a flood zone and didn't get flood insurance are at least equally, and probably more, at fault for their plight as those who allowed insufficient levees to 'protect' New Orleans (ie the people who elected officials like Nagin).
The insurance companies are stalling. Especially if there are conflicting opinions on the cause of the damage. Any lawyer knows that most juries will side with the "little guy" over the "evil corporation" unless the evidence is overwhelmingly in favor of the company.
I hope those people keep their chins up, and we all need to remember the lesson that has been taught.
Did the storm surge extend that far inland????
I am an insurance adjuster familiar with policies and my opinion is that the State Farm's insurance policy is the worst. IMHO State Farm is not the worst insurance company -- American Family could get that distinction. However, only Constitution insurance shares some of its policy langauge with State Farm. The American Bar Association has published a guide to policies and it is broken down into two parts: All Insurance Companies except State Farm and State Farm Only.
Did the storm surge extend that far inland????
I don't think So.
This whole thing leaves a very bad taste in my mouth.
Me too, having to choose between and insurance co and a lawyer
can do that to you. :>)
State Insurance Commissioner George Dale agrees. U.S. Senator Trent Lott, who lost his waterfront home says a congressional investigation is warranted.
Interesting. I don't know who I dislike more - lawyers or insurance companies. As for altered reports, the court will have to decide if the reassessed damage reports were done for fraudulent reasons or if they legitmately show that the first assessment was incorrect. Of course, this will be a jury trail, so my feeling is that insurance companies will be up against the wall...and another lawyer will have money for a new Miami estate with a yacht and illegal gardners...
I remember all the people who got screwed over around here after Isabel.
Insurance Companies are friendly nice folks when they are collecting premiums. They arent so friendly when it come time to pay out.
An insurance co that canceled me after my son had an
accident had a bill board put up that read
"Your Co for Life"
I sent them a message and told them to modify
their sign to read
"Your co for life or and one accident which ever comes first"
Interesting! We had a fire in December, caused by an appliance and were just notified that our insurance is being dropped on both our homes. Now we are faced with finding high risk insurance at 3 times the normal cost and still no attorney wants to touch us. The familiar question is "Did anybody die?" Leaves us wondering what is insurance for?
This is our first major claim in 34 years and it wasn't our fault.
Insurance adjusters, lawyers and Dickie Scruggs.
One huge mess. If Scruggs gets his way, we'll ALL pay and he'll collect zillions.
Insurance adjusters, lawyers and Dickie Scruggs.
Eeenie meenie miny and "Mo Money" for dickie
Yes, it did. Pull up a map and find Diamondhead, MS. It is inland, about 15 feet above sealevel, on the other side of I-10. It was just devastated. I have a friend who lives there and they never, ever expected to experience anything like what happened. The storm surge [according to her] was pushed up the Bay of St. Louis and over the interstate and destroyed a large part of Diamondhead.
Many of them had no flood insurance because they were not in a flood zone and trusted their insurance agents who told them they did not need it. It was not a matter of saving money, as the insurance for them would have been minimal cost. They belielved and trusted the advice they were given. My friend had flood insurance simply because it was so cheap ... even though she was told it was silly for her to buy it.
Any MS FReepers on this thread are welcome to comment on what I have posted. You may have more accurate information than I have.
Insurance adjusters aren't making the $$ here.
Thank you for the information. It seems amazing to me that a location that far inland could still be at such a low elevation and therefore vulnerable.
I know that. Their companies are being sued.
Every insurance policy issued in this country comes with a disclaimer sheet telling owners that they do NOT cover flood damage and gives them the numbers to call to get it.
The insurance companies sure aren't making the money. It's the lawyers.
Dickie Scruggs will make zillions and if he's successful it will cost ALL of us here dearly.
pollyg107 explained it all to me.
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