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Florida insurance companies took months to pay Hurricane Michael claims

Lawmakers today are discussing why nearly 12 percent of claims are still open.
FILE- In this Oct. 11, 2018 file photo, rescue personnel perform a search in the aftermath of Hurricane Michael in Mexico Beach, Fla. A year after Hurricane Michael, Bay County, Florida, is still in crisis. Thousands are homeless, medical care and housing are at a premium, and domestic violence is increasing. Michael was among the strongest hurricanes ever to make landfall in the United States. This summer, county officials unveiled a blueprint to rebuild. Among their ideas: Use shipping containers and 3-D technology to build new houses and offer signing bonuses to lure new doctors.  (AP Photo/Gerald Herbert, File) [GERALD HERBERT  |  AP]
FILE- In this Oct. 11, 2018 file photo, rescue personnel perform a search in the aftermath of Hurricane Michael in Mexico Beach, Fla. A year after Hurricane Michael, Bay County, Florida, is still in crisis. Thousands are homeless, medical care and housing are at a premium, and domestic violence is increasing. Michael was among the strongest hurricanes ever to make landfall in the United States. This summer, county officials unveiled a blueprint to rebuild. Among their ideas: Use shipping containers and 3-D technology to build new houses and offer signing bonuses to lure new doctors. (AP Photo/Gerald Herbert, File) [GERALD HERBERT | AP]
Published Oct. 15
Updated Oct. 15

Last month, Florida insurance Commissioner David Altmaier told lawmakers that he hadn’t seen “even an instance" of insurance companies breaking the law following Hurricane Michael.

But records show his office was told of at least four cases of insurers failing to pay their claims on time, with the companies paying penalties in each instance.

The notices came from employees at the Department of Financial Services, which operates an insurance complaint line that has fielded more than 1,700 complaints following the storm.

The department sent the most serious cases, including at least four involving companies violating the 90-day statute, to Altmaier’s office.

But after digging into the cases, Altmaier’s office disagreed and found the cases did not violate the 90-day statute, even though the companies paid penalties to the customers anyway.

RELATED STORY: Hurricane Michael: Insurance companies have been ‘terribly unhelpful,’ former Florida House speaker says

The cases highlight the mile-wide gaps in the law and the frustrations people in the Panhandle have had over their Hurricane Michael claims.

While state law says claims must be paid within 90 days, it only applies after a claim is made, the insurer settles on how much is owed and then the homeowner agrees to that amount. Insurers could take months coming up with an estimate, for example.

Altmaier said in a statement that his office is conducting multiple investigations and seven market conduct examinations into insurance company practices.

“We are laser-focused on identifying insurers who are not holding up their end of the bargain,” he said. “My office will exhaust all avenues available under Florida law to help Hurricane Michael survivors.”

RELATED STORY: Hurricane Michael destroyed their homes. Then the insurance heartache began.

The commissioner is scheduled to go before lawmakers again today to discuss why nearly 12 percent of claims are still open a year after the storm.

The last time he went before them, he mostly defended the insurance companies. The presentation and softball questions from lawmakers left one senator disgusted.

His office has received from the Department of Financial Services dozens of serious complaints.

In some cases, insurers canceled customers’ policies soon after the storm, something prohibited by law. In others, customers complained of lengthy delays from their insurers. More than half of the more than 1,700 complaints were over claim handling delays.

In four cases sent to his office, employees at the Department of Financial Services felt companies violated the 90-day statute.

Two of those cases were handled by Palm Beach Gardens-based Olympus Insurance.

In one of those, a customer filed a claim on Oct. 18, 2018, eight days after the storm made landfall. Months went by without a payment.

On Feb. 11, nearly four months later, the customer called the state’s complaint line about not being paid. After the state contacted Olympus, the company sent the customer a check the next day.

RELATED STORY: Hurricane Michael: There are still 18,000 open claims. Florida lawmakers want answers.

Department employees noted that the company paid interest on the amount to the customer, which is the penalty for violating the 90-day statute.

They also noted that Olympus “provided no evidence of any circumstance(s) which reasonably prevented it from complying with the [90-day] time constraints.”

In the other Olympus case, the company paid a customer $442 in interest for waiting 97 days before paying a claim.

Altmaier’s office disagreed that the cases violated the 90-day statute, but did not say why.

Olympus, which declined to comment for this story, was one of two companies issued letters by Altmaier in June encouraging them to “improve communication” with customers.

The letter noted that Altmaier’s office found “several instances in which claim payments had to be reissued due to sending to the wrong mailing address."

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