PALM BEACH GARDENS, FL, February 18, 2012
/24-7PressRelease/ -- A class action lawsuit was filed in Florida courts today against Citizens Property Insurance Corporation alleging a campaign to squeeze homeowners and supplement losses incurred when the State of Florida froze insurance rates between 2007 and 2009. The lawsuit alleges Citizens created an "Inspection and Outreach program" in order to negate existing contracts which entitled homeowners to policy discounts (Wind Mitigation Credits) if their home contained certain wind resistant features.
In accordance with state requirements, a homeowner can have a certified inspector examine their homefor specific wind resistant features such as hurricane shutters, impact rated glass, roof-to-wall connections, roof deck fastening, building code equivalent roof covering, and hip roof shape. The inspection results are documented on a Uniform Mitigation Verification Form and submitted with the insurance application to qualify for a discounted premium. A Florida Law passed in 2005 required insurers to notify insurance applicants and policyholders of the premium discounts available for installation of fixtures or construction techniques demonstrated to reduce the amount of loss in a windstorm.
Kenneth Babbitt, the representative plaintiff in the class action complaint sought insurance from Citizens in 2011 after determining that no other carrier would write a policy for his residence. He paid for the requisite inspection to qualify for the wind mitigation credit and submitted the form with his application for coverage. Citizens accepted his application and inspection form and provided him with a premium adjustment to reflect the wind mitigation credit. One month later, he received an inspection notice informing him that Citizens would be contacting him to schedule a secondary inspection of his home and advising that if he didn't allow the re-inspection "your policy premium will be adjusted to remove any credits for wind-resistive features that cannot be verified." Faced with no choice other than to allow the re-inspection, Mr. Babbitt had a Citizens inspector conduct another inspection on December 22, 2011. Shortly after he received an "Inspection Results Notice" stating that his policy premium would increase even though he had not made any changes to the structure since his initial inspection. The Uniform Mitigation Verification Form clearly states: "This verification form is valid for up to five (5) years provided no material changes have been made to the structure."
Gregory Weiss, a shareholder at Leopold Law, P.A. and co-counsel in the litigation stated, "The Inspection and Outreach Program is a scheme by Citizens to circumvent the cap on rate hikes by reclaiming revenue from properly issued Wind Mitigation Credits."
Joseph Osborne, a shareholder at
Babbitt, Johnson, Osborne & Le Clainche, stated, "Instead of accepting the inspections conducted by an independent source, they hired their own 'inspectors' whose expressed purpose was to devalue the original inspection and bolster their premiums."
Citizens currently provides coverage to almost 1.1 million policyholders, with approximately 400,000 policies receive mitigation credits. A May 2011 meeting highlighted the true motivation for Citizens' "Inspection and Outreach Program" revealing that "Over the last three years, premium revenue has been driven down by wind mitigation credits . . . the annual premium collected from policyholders is reduced by an estimated $974 million due to wind mitigation credits."
Leopold Law, P.A. is a boutique litigation firm with a proven record of fighting injustice and our attorneys have over 100 years of combined litigation experience. The firm is headquartered in Palm Beach Gardens, Florida, with offices located at 2925 PGA Blvd. and can be contacted at (561) 515-1400. For more information about Leopold Law, P.A., visit the firm's website at
www.leopold-law.com.
Babbitt, Johnson, Osborne & Le Clainche was founded in 1965 and is located in West Palm Beach, Florida. The Firm has successfully represented thousands of
Florida consumers and victims. We can be reached at (561) 684-2500. Mr. Osborne can also be reached on his cell at (561) 301-3292. Visit the firm's website at
www.babbitt-johnson.com.
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