Keep Our Families Safe
Lessons Learned from Hurricane Season 2005
By Guy Choate and Ken Suggs
The 2005 hurricane season not be soon forgotten. Hurricanes Katrina, Rita and Wilma were part of the most devastating hurricane season in the United States in decades.
For the first time in more than 50 years of naming storms, forecasters ran out of letters. After Hurricane Wilma, forecasters had to use letters of the Greek alphabet, so we had Tropical Storm Alpha, Hurricane Beta, etc.
We witnessed more than $100 billion in property damage, and the devastation of one of America’s great cities, New Orleans. Though we know that approximately 1,400 were killed by hurricanes this year, the true human cost in suffering is immeasurable.
We witnessed not just tragedy but also ordinary people who risked their lives to save neighbors and strangers alike. Americans went to the affected regions to volunteer in droves, opened their wallets and gave generously to the Red Cross and other relief organizations, and opened their cities and homes to those forced to evacuate.
Unfortunately, we were also reminded that the safety nets we thought we could count on aren’t always reliable. In particular, this hurricane season revealed the widespread difficulty Americans have had with their insurance companies after natural disasters.
Many victims of hurricanes found that their insurance representatives were unavailable to be reached, in some cases simply not responding to claims for 30 days or more, or refusing to provide temporary living expenses policyholders had paid for.
Almost four months after Katrina, some victims are still seeing delays, haven’t been able to get estimates from adjusters and still haven’t had simple claims paid. Some of these victims have had to file a class action lawsuit to force their insurers to respond to their claims and honor their policies.
In Mississippi, instead of helping residents, some insurance representatives tried to trick residents into signing waivers that would later make it easier for the insurance companies to deny their homeowners claims, according to a lawsuit filed by the State of Mississippi.
In Texas, Allstate insurance company refused to cover temporary living expenses that policyholders had paid for unless the homeowners returned to their homes, documented the damage and sent the information to the company. But for many homeowners who had evacuated, returning was impossible. Finally the Texas Attorney General and Texas Insurance Department had to order Allstate to honor its own contracts and start covering the living expenses of its Texas policyholders.
It’s up to state departments of insurance and Attorneys General, rather than the federal government, to take actions like these because the insurance industry is the only industry (other than Major League Baseball) that is exempt from federal regulation and anti-trust laws.
Consumer advocates advise insurance policyholders to review their policies frequently and be prepared, so that in the event of a disaster, you’ll know what your coverage is and what to do. You may have to fight for the coverage you’ve already paid for.
Americans for Insurance Reform offers some tips for dealing with your insurance company in the wake of a disaster:
Take notes and document everything you can.
Try, at once, to make a list of your possessions. If at all possible and as soon as you can, obtain a repair estimate from a trusted local contractor to use as a guide in talking with the insurance company’s adjuster. Keep receipts from emergency repairs and any costs you incur in temporary housing. This may be reimbursable under the "loss of use" portion of your homeowners' policy.
Keep a journal of all of your contact with or attempts to contact your insurance company. If they will not return your phone calls or fail to show at a scheduled appointment, write this down in a notebook. This could come in handy if you need to file a complaint.
Be careful what you sign.
Under your homeowners’ policy, you are likely entitled to money up front for living expenses, such as hotel costs if your home is uninhabitable. When it comes time for your insurance carrier to send you these funds, they may ask you to sign a document which says that these will be your final payment. Do not sign if you think or know that you are entitled to more.
Ask for proof.
If your insurance company tells you that your policy does not cover the damage that occurred or you feel that the offer is too low, ask for proof. The burden is on them to point out the part of your policy that states what they are saying is correct.
Be prepared to speak up.
If you are having problems with your insurance carrier such as telling you that they do not cover the damage, making a low offer or not being responsive or courteous - complain. Ask to speak to the most senior staff member in the company. Contact your state insurance department.
Guy Choate, president of the Texas Trial Lawyers Association, is a former president of the Tom Green County Bar Association and a life member of the Texas State Bar Foundation. Mr. Choate is a partner in the San Angelo, TX law firm of Webb, Stokes & Sparks.
Ken Suggs, president of the Association of Trial Lawyers of America, is a partner in the Columbia, SC, law firm of Janet, Jenner & Suggs.