As San Francisco insurance attorneys, we know one of the most devastating loses is one’s home. When something takes away a home, everything is upended and we need our insurance providers to come to our aide quickly so we can move on with our lives. Unfortunately, that is often when insurance companies stall and engage in unscrupulous and illegal behavior.
This week, California insurance regulators under the Department of Insurance have filed three actions against an American International Group Inc. (AIG) owned subsidiary company, New York based New Hampshire Insurance Co, over how it handled claims from that 2008 Sayre fires that devastated over 11,000 acres in the Los Angeles area in what has been dubbed the worst loss of homes due to fire in the city’s history. On that horrible November day, 600 structures were destroyed, leading the Mayor of Los Angeles and the Governor of California to declare a state of emergency. At the Oakridge Mobile Home Park alone 480 mobile homes were totally destroyed, and New Hampshire Insurance covered 370 of them with Mobile Homeowners Policies.
In the months after the Sayre fires, the Department of Insurance received numerous complaints about the insurance company’s handling of claims and investigated those complaints. The Department eventually cited New Hampshire and another subsidiary, York Risk Services Group Inc, with 125 violations of the California Insurance Code with unfair or deceptive claims practices in failing to diligently handle claims. Each of these violations, if substantiated, would have a civil penalty of $5,000 per act, raised to $10,000 if the act was willful. Department general counsel Adam M. Cole stated to reporters this week that, “We expect insurers and their agents to be thoroughly diligent in handling claims, especially at times of devastation such as the Sayre fire. The allegations in this case reflect a troubling lack of attention to consumer needs by New Hampshire Insurance Company.”
The Department of Insurance said it had issued an Order to Show Cause, a statement of charges/ accusations, and a notice of monetary penalty against New Hampshire and its claims processing subsidiary. New Hampshire Insurance is planning to contest these citations in an administrative hearing, but parent company AIG has not made any statements with regard to this issue.
This is not the first time the Department of Insurance has had to step in with the AIG-owned subsidiary over the Sayre fires. In 2009, the Department acted on complaints by consumers over how much extended replacement cost coverage was available under New Hampshire’s policies. At that point, the Department was able to get between 110 and 125 percent of the fire insurance coverage for most policyholders, which was an increase of approximately $10.8 million.
While this is good news, waiting for government agencies to sort out complaints dealing with delayed claims and file actions a year or more after the disaster may not be sufficient for some homeowners cheated by their insurance companies. A qualified San Francisco insurance attorney will be in your corner and focus on you specific case and circumstances to help you get what you deserve as soon as possible.
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