Florida insurer fined $1M for mishandling Hurricane Ian claims
Hurricane Ian caused more than $112 billion in damage, making it the costliest hurricane to ever hit Florida.
A Florida insurer has been ordered to pay a $1 million fine after a review by the state found it violated claims handling regulations in the aftermath of Hurricane Ian.
A report from the Florida Office of Insurance Regulation (FLOIR) states that after a review of post-Ian claims from September 28, 2022 to February 28, 2023, it found Heritage Property & Casualty Insurance Company violated state insurance law in several ways, including:
- Failure to acknowledge receipt of a claim communication within 14 calendar days.
- Failure to provide the policyholder with a document containing the adjuster’s name and license number.
- Failure to include the name and license number of the adjuster in subsequent communication regarding the claim.
- Failure to pay or deny a claim or a portion of that claim within 90 days after notice of an initial, reopened or supplemental property insurance claim.
- Failure to calculate the correct amount of interest owed on payment of a claim.
- Failure to pay interest when the claim payment was made 90 days after receiving notice of the claim.
- Failure to utilize property appointed adjusters.
- Failure to maintain claims experience records.
Hurricane Ian made landfall in southwestern Florida as a category 4 storm in September 2022, bringing with it damaging winds, storm surge and historic freshwater flooding. In total, it caused more than $112 billion in damage – making it the most costly hurricane to ever hit Florida, and the third most costly to affect the United States.
In March 2023, the Washington Post reported that an investigation into Hurricane Ian claims showed that a number of policyholders for some regional Florida carriers – including Heritage as well as Florida Peninsula Insurance Company – had their claims cut 45% to 97% below what adjusters had estimated. The report specifically sites one instance in which a couple in Rotonda West, Florida, received an estimate to repair their home of around $200,000 from the licensed third-party adjuster sent by Heritage. When the adjuster checked on their claim report around ten days later, however, he discovered they were only set to receive $27,000. He claimed this change was made without his knowledge or consent.
Heritage agreed to a Consent Order from the FLOIR requiring the company to pay an administrative fine of $1 million, as well as $10,000 in administrative costs within ten days of the order’s filing on May 9, 2024.