Slicked and SLABBED – and just flat overwhelmed

Nowadays, the process of selecting a post topic is akin to a game of disaster roulette.  As a result, I was “slicked and slabbed” by “writer’s block” – the chief symptom of same, a growing file of drafts but no post.  Fortunately,  “writer’s block” is not contagious nor does it limit reading.  Thus, I begin my recovery with an update on issues I’ve been following:

Ivor van Heerden lost the second round of his fight to regain his position with LSU:

A federal judge scolded LSU late Thursday for not being “much more professional’’ in parting ways with Ivor van Heerden, but said the respected coastal researcher failed to show that LSU retaliated against him for openly blaming the U.S. government for the levee failures in New Orleans after Hurricane Katrina.

U.S. District Judge James Brady’s refusal to issue a preliminary injunction in van Heerden’s lawsuit against LSU means van Heerden, who has worked at the school for more than 15 years, must clean out his office.

Van Heerden’s attorney, Jill Craft, had asked Brady to “require LSU to keep his position on the books.’’

Craft said she now will move for an expedited jury trial of van Heerden’s suit. Brady said he would entertain such a request. h/t New Orleans News Ladder

Chip Merlin’s Back on the Texas Ranch-Hurricane Litigation and Settlement Discussions are Raging brings us up to date on litigation following Hurricanes Dolly and Ike with news that “TWIA is in trouble”: Continue reading “Slicked and SLABBED – and just flat overwhelmed”

Another mess in Texas – lawsuit claims TWIA rigged process

The Texas Windstorm Insurance Association used prices lower than market rates to estimate materials and repair costs, unfairly limited costs on roof repairs and discouraged reopening closed claims, a League City home-owner alleges in a lawsuit that includes internal TWIA e-mails and documents.

“The game is rigged from the beginning,” said Steve Mostyn, the homeowner’s attorney who obtained hundreds of documents through the discovery process. “All the parts are designed for one purpose, which was to save money and underpay these claims every way they can, not by accident nor incompetence but a systematic effort.”

Rigged from the beginning – surely not!  ( h/t observant reader and the Houston Chronicle Lawsuit says windstorm insurer rigged process)

The lawsuit alleges the insurer told adjusters to base claims estimates on an internally developed price guide — with prices lower than market — instead of pricing software commonly used by the industry.

One adjusting firm reported the market rate for roof repairs was $230 to $255 per 100 square feet, but TWIA’s price was $182, the lawsuit claims. In internal documents filed with the lawsuit, the association portrays its prices as just a guideline.

The game, as Mostyn called it,  sounds familiar, does it not?  There’s more: Continue reading “Another mess in Texas – lawsuit claims TWIA rigged process”

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)”

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: 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!”

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”

…and I called FEMA, too – called it the “f word” for not knowing a hurricane hit New Orleans; treating people like hamburgers on a grill after Ike

Oh, there’s just so much tell about Shattering the Illusion of FEMA’s Progress, the report produced by the American Federation of Government Employees, Local 4060 that offers 10 Recommendations for Rebuilding a Broken Agency. Sop covered the basics in Slabbed Welcomes FEMA’s Rank and File Employees.

I followed with  I called FEMA and they didn’t even know a Hurricane hit New Orleans, a brief heads-up post also confessing both my good intent and turtle-like typing,

SLABBED  is indeed pleased to assist the Agency’s committed employees and reservists in their recovery from the  disaster known as FEMA (AKA “the f-word”) by telling their story in their own words.

Training – the need for and lack thereof at all levels – is a consistent theme in the suggestions from current and former FEMA employees found on pages 17-91 of the report.

I called FEMA and they didn’t even know a hurricane hit New Orleans

When I applied for disaster assistance almost three weeks after Hurricane Katrina, the person on the other end told me I was lucky to live in New Orleans because he and his buddies were planning to go there for Spring Break. I thought this somewhat insensitive, but Continue reading “…and I called FEMA, too – called it the “f word” for not knowing a hurricane hit New Orleans; treating people like hamburgers on a grill after Ike”

“I called FEMA and they didn’t even know a hurricane hit New Orleans”


Most days, I type like a turtle.  On a good day, I’m a Wilma Flintstone backed up by little birdies pecking away.

Today is one of those “most days” and I wanted you to know that I’m working and will have a post up soon that explains the title and a whole lot more.

So, with apologies to unowhour, cominglatersooner  is the very believable unbelievable story of the disaster known as FEMA.  SLABBED is pleased to provide the disaster assistance and pass along with this picture of the post-Ike assistance provided in Houston by a kind-hearted, clear-headed Home Depot.

My thanks to AFGE Local 4060 for trusting us to tell the story.  Otherwise, I would have been the last to know – it seems I always am.

For example, I’ve only recently discovered that FEMA pays the legal fees when a WYO insurance company is sued by an NFIP policyholder!

Could I ever have used one of those orange buckets last night!  My stomach was so unsettled after reading the Agency’s legal guide that I got little more than a wink of sleep.

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”

SLABBED welcomes Texas Windstorm Association and Ike victims to “the scheme”

Texas Windstorm Insurance (TWIC) has canned software programs that the Adjusters have to use for their estimates. The unit prices on the structures are about 40% low, old and outdated. The adjusters make choices on which unit price item to use and that usualy makes the estimate also low. Drawings must be made by registered Professional Engineers in the State of Texas. The engineer designs to the new codes but the costs in the software programs are not updated…

This gem of information was among the 74 comments to the Houston Chronicle’s story Homeowners battle for higher payouts to fix Ike damage.

Hurricane Ike blew some shingles off William Cognata’s La Porte home and loosened a lot more.

His roofer told him he needed to replace it, but his insurer offered $466 for repairs.

“Three roofers looked at it and told me to replace it. I’m no roofer, but I have some sense to know who to listen to,” he said.

Area homeowners have survived the storm, waited weeks in some cases for the lights to come back on and opened their homes to insurance adjusters.

Now, as residents slammed by Ike work their way through the recovery process, some are entering a new phase: the battle for what they consider a fair settlement of their claims.

Some are complaining to regulators, hiring their own experts and, like Cognata, turning to attorneys to get higher insurance payouts.

More than 1,700 Texans so far have complained to the state about their insurance companies — everything from claims delays to unsatisfactory offers and denials.

That’s a small percentage of the more than 530,000 claims filed already in the wake of Hurricane Ike, but state regulators say they’re monitoring the number of reports and how they’re resolved to make sure policyholders are treated fairly. The agency can require bigger payments if necessary.

“We certainly want to hear if there are any complaints about the claims process,” said Jerry Hagins, a spokesman for the Texas Department of Insurance.

Perhaps, Mr. Hagins will read the comments like this one in the Chronicle. Continue reading “SLABBED welcomes Texas Windstorm Association and Ike victims to “the scheme””