Category: Hurricane Ike

The best little whorehouse in Texas may have a leak in the roof

I have been involved in a lot of disputed property insurance claims in many venues over the past twenty-five years where emotions run high, but the Texas Windstorm Insurance Association (TWIA) is the blue ribbon winner in Texas for policyholders that hate how they have been treated. And, it is not just limited to the customers of TWIA. A number of independent adjusters representing TWIA are ready and willing whistleblowers in lawsuits against TWIA regarding these practices. They are upset as well.

FireShot capture #062 - 'insurance_pdf (application_pdf Object)' - images_chron_com_content_news_pdfs_09_09_11_insurance_pdfChip Merlin, who blew the cover off roof damage in Texas last March, has been reporting more about TWIA’s handling of claims from Hurricane Ike. Sop caught up with Chip in the Houston Chronicle story reported in his recent post And the beat does go on, as in the beat down of the taxpayers and the NFIP by shady insurers.

Although you Don’t Mess with Texas, apparently there is no problem with TWIA making a mess out of Texas Continue reading “The best little whorehouse in Texas may have a leak in the roof”

Oh, say can you see Ike’s wind came before the sea (edited)

Anyone who still doesn’t believe hurricane surge washes away what the wind destroys need look no further Galveston Island’s Beachtown after Hurricane Ike for evidence.

"After Ike" photograph of home in Galveston Island's Beachtown
"After Ike" photograph of home in Galveston Island's Beachtown

Hurricane Ike hit Galveston Island in the early morning hours of September 13th, 2008. The sheer size of the hurricane impacted a majority of the Texas Gulf Coast, in addition to the SW Gulf Coast of Louisiana.

At the East End of Galveston Island, the hurricane delivered its fiercest winds as well as a storm surge not experienced since the devastating hurricane of 1900. Beachtown found itself in the unenviable position of receiving the dirty side of the hurricane and Ike’s relentless punches delivered from the Northeast…

Galveston Island was inundated with hurricane debris, including boats lying in the streets and esplanades….a devastating blow to Galveston Island. There were clear signs of Ike’s presence at Beachtown, as many of the streets and lawns were covered by a layer of sand brought by the storm surge.

However,most compelling was the condition in which the residences and other structures lay… largely unscathed. Signs of hurricane Ike’s impact were limited to the breakaway sections of the structures. The buildings’ structures performed outstandingly. The habitable floors remained undamaged despite the horrific forces of Ike.

FEMA and the City of Galveston require the enclosed portion of structures located below Base Flood Elevation (as is the case for coastal communities and beachfront homes) be designed to break-away with the impact of a hurricane force, leaving the main structure intact. Ground Floor breakaway materials, such as louver panel assemblies and garage doors, separated as designed.

Continue reading “Oh, say can you see Ike’s wind came before the sea (edited)”

Stupid is as stupid does: Scientific Integrity at LSU gets a black eye

Nowdy wasn’t lying yesterday when she said I was slabbed with work. I’m also slabbed by a nasty virus that has been going around since January but not so much that the significance of Ivor van Heerden’s dismissal from LSU was lost on me when I saw the news very early this morning.  I also knew when I saw it that Editilla would be all over it and indeed it headlines today’s New Orleans News Ladder which is where we begin:

This is a Bad News Corps Victory. This bad scene probably has as much to do with Dr. van Heerden’s Storm Surge Modeling running afoul of Gerald Galloway’s, the Storm Surge Modeling Business, FEMA Flood Zone Mapping and undue ASCECORPS influence in National Flood Control Policy.

I wish I could say it was just as simple as a bad news victory for the USACE but there is more as I discovered late this morning when a reader emailed me additional background:

van Heerden was responsible for the pre-Katrina animation of Hurricane Pam, which was largely ignored by the government and the insurance industry. Every time he speaks, he (rightfully) embarrasses someone who did not do their jobs.

Although van Heerden did not become an expert for hire in Katrina litigation, other members of the L.S.U. engineering department and geology/meteorology/climatology departments did for State Farm.  This was a “too cute” move by State Farm to try and lend LSU credibilty to its bs defenses.

Evidently it didn’t take too long for enterprising lawyers to make these guys look like fools in depositions. From a PR standpoint the fact these taxpayer paid college professors were working against the very people who paid their salaries was a disaster, kind of like the Allstate Challenge at the 2007 BCS National Championship game in NOLA when former LSU kicker David Browndike was booed off the field at halftime. The readers email concluded: Continue reading “Stupid is as stupid does: Scientific Integrity at LSU gets a black eye”

Merlin blows cover off roof damage in Texas

My wish is that somebody is going to read this Blog, call or write TWIA, and let them know that they need to write all their policyholders to alert them that the memo is wrong. However, my guess is that they will hire an attorney, and try to defend or explain the memo. (Chip Merlin)

I must admit to having similar thoughts about posts on SLABBED when I see a case lost for lack of information readily available to a non-lawyer researching the issue.  Frankly, I hold out virtually no hope of any insurer ever admitting to and correcting an error.  The field appears to be dominated by leaders who view themselves as Mr. Always Right.  Eager to shake the label “bureaucrat”, leadership of publicly funded windpools and other “last resort” options quickly forget such programs exist because of a related failure in the insurance industry and eagerly become “one of the boys” – a lapse that IMO is resulting in an overpopulation of these Mr. Rights commiting every possible wrong.

Merlin’s wish would be my command if I had such power; but, alas, I have only the power to join him in wishing  for a good outcome from his effort and, in the absence of a magic wand,  cross-post  The TWIA Roof Damage Memo: Checking Basic References to Resolve Adjustment Questions that contains a link to his equally excellent Internal Texas Windstorm Roofing Claims Memo Explains Damage is Not Covered.

The post from this morning, Internal Texas Windstorm Roofing Claims Memo Explains Damage is Not Covered, raised a number of interesting methods to research this coverage issue. Many risk managers and public adjusters will simply call me to get a quick opinion regarding many day to day coverage issues. I thought it might be interesting to see what adjusters may have in their basic training materials to answer the questions raised in the memo. I have no idea if the TWIA claims executives looked at any reference materials. I hope they authored the claims memo in ignorance, because the opposite poses a different set of problems. Continue reading “Merlin blows cover off roof damage in Texas”

Merlin’s blog cookin’ with news of Ike claims handling – SLABBED brings desert

Chip Merlin has been cooking on all burners and dishing out news of Ike claims handling faster than I could digest and link  Dig into this big spread – we were all invited – and then I’ll put out a little desert.

If you want to find a bunch of irate policyholders with plenty of stories to tell, hang out with Tina Nicholson and Javier Delgado in our Houston office. Commercial and residential policyholders have had enough frustration trying to do it themselves and are seeking legal counsel to fight the delays and denials from their insurance carriers. Anger at the insurance company and the adjusters working their claim is the prevalent emotion. Continue reading “Merlin’s blog cookin’ with news of Ike claims handling – SLABBED brings desert”

Becky Mowbray Profiles Recent Policyholder Court Wins in the Times Picayune

And of course such a profile had to include extensive quotes from Rick Trahant who needs no introduction here at Slabbed and Soren Gisleson whom Nowdy has had the opportunity to chat with via email. Louisiana Insurance Commish Jim Donelon throws a wet blanket on the Ike theory but then again Rick isn’t on Mr. Donelon’s Christmas list in any event. Here is the profile:

After siding with insurance companies in early rulings after Hurricane Katrina, the 5th U.S. Circuit Court of Appeal has suddenly cranked out a stream of policyholder-friendly rulings in hurricane cases.

In recent weeks, the region’s federal appellate court has affirmed an award in favor of a homeowner, overturned a decision in favor of an insurer, said that homeowners can collect mental anguish damages when insurers don’t pay, and revived a whistle-blower lawsuit alleging that insurers ripped off the government in paying flood claims.

The apparent change of heart has left many giddy plaintiff attorneys wondering whether the Texas judges involved in the favorable decisions have been moved by the experience of Hurricane Ike slamming their home state.

“Now, going to work, they see all the damage a Category 1 windstorm did to downtown Houston,” Rick Trahant said. “I think, as people, they can’t help but to be affected by what they’ve seen in their own state in Texas.” Continue reading “Becky Mowbray Profiles Recent Policyholder Court Wins in the Times Picayune”

Merlin: The parable of Hurricane Ike insurance claims!

and the moral of this story is…

My good buddy, Tom Grail, told me the parable of Hurricane Ike Insurance Claims. To appreciate this, one must first understand that the total loss structures in Galveston and Bolivar receive uniform estimates of wind damage from the Texas Windstorm Insurance Association (TWIA). The amount of damage caused by wind for nearly every structure is approximately 11%. The reports are virtually identical for every total loss structure, despite differences in the age of the structure and quality of construction.

The parable is a story of two men, Larry and Moe, who were on the peninsula when Ike hit. Larry was struck by a flying 2X4 launched by the wind, then, when the surge came, he grasped a floating timber and made it to safety. He was treated for his injuries, estimated at 11% of his being.

Moe was not so lucky. He was killed instantly by a flying TV set. The storm surge subsequently swept his body away.

The medical examiner compared Moe’s corpse to Larry. After taking several months to consider the situation, the examiner declared that Moe was only 11% killed by wind, because that’s what happened to Larry. He opined that 89% of Moe’s death must have been due to flooding.

Merlin goes on to add: Continue reading “Merlin: The parable of Hurricane Ike insurance claims!”

Speaking of lobbying – NFIP pays insurance company legal fees in flood claims disputes!

We are pleased to transmit to you the Federal Insurance Administration’s (“FIA”) new Guide for Write Your Own Counsel. This Guide provides important information on the policies and procedures to be followed by Write Your Own Companies (“WYO Companies”) and their counsel in litigation involving the National Flood Insurance Program (“NFIP”)…

Since the inception of the WYO Program in October 1983, defense of lawsuits based on the SFIP has generally been handled smoothly and effectively. We stand ready to continue to offer support to WYO Companies in all litigation matters concerning the NFIP in our ongoing spirit of partnership.

Can you believe it? I can not – but google search results for “NFIP litigation” offered a copy.

This Guide for Write Your Own Counsel (“Guide”) has been developed by the Federal Insurance Administration (“FIA”) and the Federal Emergency Management Agency (“FEMA”) Office of General Counsel (“OGC”) to assist Write Your Own (“WYO”) Companies and their counsel defending National Flood Insurance Program (“NFIP”) litigation.

So much for thinking it is the deep pockets of the insurance industry that put most NFIP policyholder-plaintiffs at a financial disadvantage in litigation – those deep pockets are in Uncle Sam’s pants!

The FIA and WYO Company share a unique and common interest in the defense of cases related to the NFIP. Among other factors that give rise to this shared interest are the fiduciary responsibilities of the Company, the statutory and regulatory basis for the NFIP, the Federal government’s administrative and oversight responsibilities for the program, the need to share privileged information, and the fact that Federal funds are at risk. Accordingly, through the Arrangement, the FIA and the WYO Company have entered into a joint defense agreement to implement FEMA’s oversight responsibilities for the purpose of any litigation related to or arising under the NFIP to enable the free flow of information between the FIA, FEMA OGC, the WYO Company, and its legal counsel.

“Unique” is not exactly what I’d call the the government’s “common interest” with the insurer defendants in Katrina litigation.  I wonder if Judge Senter had a better word in mind in the “opinion” he would not “venture” in his December 12, 2008 Order in Gagne v State Farm. Continue reading “Speaking of lobbying – NFIP pays insurance company legal fees in flood claims disputes!”

Treading Water – claims handling in Texas following Hurricane Ike

While the National Insurance Law Forum waited a bit longer than most to ask Hurricane Ike Insurance Litigation: Will it be as bad as Katrina?,  the November 17, 2007 post also suggested the answer.

It didn’t take long for the first bad faith suits arising from Hurricane Ike to be filed in Texas. Last week, the first two Ike bad faith lawsuits that I am aware of were filed in Galveston and Ft. Bend Counties…These are first of several thousand Ike lawsuits expected to be filed across Southeast Texas over the next several years…

The big question being asked by carriers across the country is whether Hurricane Ike will generate the type and volume of litigation generated by Hurricane Katrina. In the three years since Hurricane Katrina, it has been estimated that between 27,000 and 30,000 hurricane insurance suits were filed in southern Louisiana alone. Of the 12,565 suits filed in federal court, only slightly more than half — 7,837 — cases, have gone to judgment or settled.

The seventh edition of the Hurricane Ike Insurance Newsbrief (January 26, 2009) quotes the Texas Department of Insurance reporting that in the three months after Hurricane Ike… over 730,000 insurance claims have been filed and the number continues to rise.

From the policyholder’s perspective, the numbers indicate a mixed blessing.  The longer it takes for a case to get to court the more likely it is that new case law will replace Leonard and other of the 5th Circuit’s poorly reasoned opinions on Katrina litigation.  Chip Merlin’s post on the 5th’s decision in Leonard, Fifth Circuit got it wrong,  points out where the Court’s reasoning failed.

In their rationale…the 5th Circuit provides a less than stellar (okay really absurd) example of non-coverage that virtually all insurance companies issuing an all-risk policy would heretofore pay. After finding that the anti-concurrent causation language was not ambiguous, Judge Edith Jones went too far and provided the following:

“If, for example, a policyholder’s roof is blown off in a storm, and rain enters through the opening, the damage is covered. Only if storm-surge flooding – an excluded peril – then inundates the same area that the rain damaged is the ensuing loss excluded because the loss was caused concurrently or in sequence by the action of a covered and an excluded peril…

Where did that come from? Virtually every adjuster and claims manager I have ever deposed with that similar hypothetical situation in a Katrina loss has said coverage would be granted under the all-risk policy for the full amount of the loss…From a practical standpoint, where is there going to be any coverage if the flood policy has the typical exclusions regarding pre-existing loss or “roof leaks or wind-driven rain” as found in the National Flood Policy?

That seems to be one of the big questions in Texas following Ike, according to Thousands waiting for windstorm payments, the article from the Galveston County Daily. h/t Dimechimes. Continue reading “Treading Water – claims handling in Texas following Hurricane Ike”

The ice claims cometh! Kentucky reports more damage from ice than Ike

Just months after Hurricane Ike whipped by Kentucky, the emergency management agency there is reporting the ice storm gripping the area is even more destructive.

Kentucky insurance carriers have taken thousands of claims as a result of this week’s ice storm, and agents said yesterday they expect to hear from more policyholders as power is restored.

State Farm, which insures 22 percent of Kentucky homeowners, expects to handle about 6,000 claims statewide.

Although damage was widespread in Louisville, State Farm spokeswoman Lisa Ripley said the worst was in the Paducah area, which didn’t have full cell phone and landline service as of yesterday.

Some of the larger insurers are setting up mobile response vehicles, and the state Department of Insurance is allowing licensed adjusters in other states to come to Kentucky to speed up the claims process.

“Once power has been restored and people are able to get out and assess the damage, we believe the number of claims will begin to rise,” said spokeswoman Ronda Sloan.

Kentucky Farm Bureau, the state’s second-largest insurer for homeowners after State Farm, already has taken about 2,000 claims, spokesman Greg Kosse said. Continue reading “The ice claims cometh! Kentucky reports more damage from ice than Ike”