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Florida insurance no insurance at all for some people -
Posted on 8/5/23 at 9:26 pm
Posted on 8/5/23 at 9:26 pm
LINK /
UPC, the ninth property insurer in Florida to go insolvent since 2021, and the largest to do so in 15 years, left many of its Florida customers in a similar nightmare, facing what is predicted to be a powerful hurricane season with still unfixed, hazardous homes, drained life savings and, in some cases, no insurance to protect them.
Suddenly losing their carrier while still in the thick of recovery was shocking to the Raggies, as well as other homeowners. But UPC’s collapse was long in the making — and is one of the most glaring examples of how, in the age of climate change, Florida’s insurance system has been failing to protect residents after they endure a major disaster.
UPC hemorrhaged money over the past six years, in large part because of costly claims from a series of major hurricanes. During this time, the company began to cut insurance adjusters’ damage estimates, and underpay and ignore increasingly desperate policyholders, according to a Washington Post investigation based on interviews with nearly two dozen people, including those who worked for UPC, policyholders, insurance experts and a review of hundreds of documents from regulators, adjusters, court cases financial filings and other sources.
The company also underestimated how much it would have to spend to cover claims, but still paid shareholders, including top executives who owned a significant percentage of the company, millions of dollars in dividends, data showed.
State officials, who said failing to reserve enough money was one of the primary reasons UPC went insolvent, struggled to respond as the situation worsened. People in the industry flagged evidence of alleged wrongdoing to regulators, but said their concerns were not seriously reviewed. And even though officials initiated monthly check-ins with UPC as its finances deteriorated, they mistakenly believed UPC could cover homeowners’ claims up until just shortly before the insolvency.
Now, the state-run Florida Insurance Guaranty Association is responsible for trying to close 22,000 UPC claims, which will take more than a year and probably cost around $600 million, officials say. For the first time since Hurricane Andrew in 1992, the state has to levy an emergency assessment on nearly all Florida residents to help cover the cost of such a massive insolvency, further spiking homeowners’ rates.
While Florida residents are shouldering the burden of the insurer’s collapse, its former executives and shareholders are in better shape.
UPC was the centerpiece of a larger insurance company, United Insurance Holdings Corp. The company has seen its stock price, which had declined dramatically in the wake of UPC’s struggles, bounce back more than 1,000 percent since December — adding more than $200 million in value. The company, which has since rebranded, has been touting its new, more lucrative future to prospective investors, saying it’s much stronger for getting out of the home insurance business.
UPC, the ninth property insurer in Florida to go insolvent since 2021, and the largest to do so in 15 years, left many of its Florida customers in a similar nightmare, facing what is predicted to be a powerful hurricane season with still unfixed, hazardous homes, drained life savings and, in some cases, no insurance to protect them.
Suddenly losing their carrier while still in the thick of recovery was shocking to the Raggies, as well as other homeowners. But UPC’s collapse was long in the making — and is one of the most glaring examples of how, in the age of climate change, Florida’s insurance system has been failing to protect residents after they endure a major disaster.
UPC hemorrhaged money over the past six years, in large part because of costly claims from a series of major hurricanes. During this time, the company began to cut insurance adjusters’ damage estimates, and underpay and ignore increasingly desperate policyholders, according to a Washington Post investigation based on interviews with nearly two dozen people, including those who worked for UPC, policyholders, insurance experts and a review of hundreds of documents from regulators, adjusters, court cases financial filings and other sources.
The company also underestimated how much it would have to spend to cover claims, but still paid shareholders, including top executives who owned a significant percentage of the company, millions of dollars in dividends, data showed.
State officials, who said failing to reserve enough money was one of the primary reasons UPC went insolvent, struggled to respond as the situation worsened. People in the industry flagged evidence of alleged wrongdoing to regulators, but said their concerns were not seriously reviewed. And even though officials initiated monthly check-ins with UPC as its finances deteriorated, they mistakenly believed UPC could cover homeowners’ claims up until just shortly before the insolvency.
Now, the state-run Florida Insurance Guaranty Association is responsible for trying to close 22,000 UPC claims, which will take more than a year and probably cost around $600 million, officials say. For the first time since Hurricane Andrew in 1992, the state has to levy an emergency assessment on nearly all Florida residents to help cover the cost of such a massive insolvency, further spiking homeowners’ rates.
While Florida residents are shouldering the burden of the insurer’s collapse, its former executives and shareholders are in better shape.
UPC was the centerpiece of a larger insurance company, United Insurance Holdings Corp. The company has seen its stock price, which had declined dramatically in the wake of UPC’s struggles, bounce back more than 1,000 percent since December — adding more than $200 million in value. The company, which has since rebranded, has been touting its new, more lucrative future to prospective investors, saying it’s much stronger for getting out of the home insurance business.
Posted on 8/5/23 at 9:30 pm to Eurocat
I sure wouldn’t want to write a policy for any Floridian just based on the hurricane threats there.
Posted on 8/5/23 at 9:36 pm to Eurocat
quote:
The company also underestimated how much it would have to spend to cover claims, but still paid shareholders, including top executives who owned a significant percentage of the company, millions of dollars in dividends, data showed.
That shite should not fricking be legal.
When a company is struggling to meet it's obligations to actual customers the sharholders dividends should be the first thing to get cut off.
This post was edited on 8/5/23 at 9:38 pm
Posted on 8/5/23 at 9:38 pm to Quatrepot
quote:
I sure wouldn’t want to write a policy for any Floridian just based on the hurricane threats there.
My understanding is that it’s not just a risk situation, it has to do with the jury awards on suits going off the rails.
If it were just a risk situation you could double rates, sell the policy to a reinsurer and make bank but if juries are handing out massive settlements you can’t accurately predict risk from an actuarial standpoint.
This post was edited on 8/6/23 at 7:51 am
Posted on 8/5/23 at 9:41 pm to tide06
quote:Gotcha. tks.
My understanding is that it’s not just a risk situation, it has to do with the jury awards on suits going off the rails.
Posted on 8/5/23 at 9:42 pm to Eurocat
From CNN after Farmers announced their withdrawal from Florida:
quote:
“Over the past 18 months in Florida, 15 home insurers have placed moratoriums on writing new business, four carriers have announced plans to voluntarily withdraw from the market and seven companies have been declared insolvent,” Mark Friedlander, a spokesperson for Insurance Information Institute, told CNN. “Currently, there are 18 Florida residential insurers on the state regulator’s watch list due to concerns over their financial health.”
Posted on 8/5/23 at 9:54 pm to Dr RC
quote:
quote:The company also underestimated how much it would have to spend to cover claims, but still paid shareholders, including top executives who owned a significant percentage of the company, millions of dollars in dividends, data showed.
That shite should not fricking be legal. When a company is struggling to meet its obligations to actual customers the sharholders dividends should be the first thing to get cut off.
We may have to go the route of nonprofit insurance or where insurance companies are owned by the individual policy holders.
This post was edited on 8/5/23 at 9:55 pm
Posted on 8/5/23 at 9:55 pm to Eurocat
quote:
in the age of climate change,
Posted on 8/5/23 at 9:59 pm to stout
Our church in Destin just got a bill for $190,000.for one year.
Posted on 8/5/23 at 10:01 pm to Eurocat
I'm waiting for State Farm to drop the hammer on Louisiana. Then we got real problems.
Or at least I got problems.
Or at least I got problems.
Posted on 8/5/23 at 10:19 pm to Eurocat
My home insurance doubled this year. I shopped around but couldn’t find anything better. I know people with property on the beach and their insurance is $6,000 more a year than just a couple of years ago.
Posted on 8/5/23 at 11:06 pm to geauxpurple
quote:The twelfth offering tonight is for the insurance company….
Our church in Destin just got a bill for $190,000.for one year.
Posted on 8/5/23 at 11:11 pm to geauxpurple
quote:
Our church in Destin just got a bill for $190,000.for one year
I’m guessing this is some sort of Joel Osteen mega church. Because, damn.
Posted on 8/5/23 at 11:37 pm to geauxpurple
Luckily they pay no other taxes…. Soooooo
Posted on 8/6/23 at 5:46 am to Eurocat
quote:
and is one of the most glaring examples of how, in the age of climate change
Media doesn't have an agenda at all.. nope not at all
Posted on 8/6/23 at 6:08 am to geauxpurple
quote:
Our church in Destin just got a bill for $190,000.for one year.
DWC?
Posted on 8/6/23 at 6:29 am to Eurocat
The idea that we can build expensive properties in highly vulnerable areas and expect them to be fully insured with cheap insurance is unsustainable. We will have to move to a system where the owner bears a lot of the risk for named storms through high deductibles or coinsurance. There is no other way.
Posted on 8/6/23 at 6:34 am to Eurocat
But Desantis now fighting the states largest single site employer, which is far more important to the citizens of Florida.
Posted on 8/6/23 at 6:57 am to SloaneRanger
quote:
The idea that we can build expensive properties in highly vulnerable areas and expect them to be fully insured with cheap insurance is unsustainable. We will have to move to a system where the owner bears a lot of the risk for named storms through high deductibles or coinsurance. There is no other way.
It is the same problem people don’t understand with regular health insurance.
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