Category: Blog

A letter to TWIA

This is a re-print of the article form The Port Aransas Jetty, Scott Burroughs, Jan 31, 2018


We just received a bill for our 2018-2019 Texas Windstorm Insurance Association (TWIA) premiums. Attached is the first draft of a letter to accompany our payment.

Dear TWIA:

We are in receipt of your invoice for our 2018 Windstorm Insurance policy. We are so impressed by the way you are still handling our Harvey claim (five months after we filed it) that we have decided to employ your same protocols in paying this bill.

Although we would like to fulfill our obligation to pay you immediately, we have a few internal policies that we had not previously disclosed to you, that may cause some delays. We have no legal, moral or business reason to follow these policies, but we will follow them anyway because, after all, they are our policies.

Prior to issuing you a check our adjuster (me) must review your invoice. Once the initial review has been completed, our adjuster will forward the bill to his supervisor (my trophy wife) for final approval. This process generally takes seven to 10 business days, but may need to be extended with or without cause.

If your bill is approved by the supervisor, it will be returned to the adjuster for processing. This may take an additional week to 10 days. Even though his supervisor has already approved your invoice, the adjuster may insist that you provide further documentation to justify your costs. The requirements will likely be arbitrary, but you will still have to provide the documentation for the adjuster to proceed with your claim. Once the supporting documents are received from you they may sit on the adjuster’s desk for a week or two. After the adjuster gets around to reviewing them (assuming they are not lost in the interim), the 10-day processing period will begin again.

At some undisclosed time after the adjuster is satisfied that you have met all of the requirements to justify paying the bill in full, and there is no reason for any further delay, the supervisor will authorize payment of about 10 percent of the amount that you are entitled. If you would like additional disbursements, you will have to file supplements. If you have any questions on how to file a supplement you may send us an email and or call us directly. If you send us an email we will not acknowledge receipt, nor will we respond to your correspondence. If you choose to call us, you will have to wait in an automated phone queue for at least seven minutes. (You will be required to wait in this queue every time you call. Under no circumstance will you be provided a number to contact your adjuster without first waiting in the queue.) While on hold, you will be repeatedly instructed to email us. If you make it out of the automated queue without being disconnected, you will be transferred to voicemail, and we may or not respond to your message. If we don’t respond you will be required to start the process over. Despite your best efforts, we are still not sure if you will ever receive full payment.

At first glance these protocols may seem a little asinine, but after five months of dealing with TWIA we have learned that this is your preferred method of conducting business.


The Burroughs Family.




Insurance company accused of delayed response to storm claims

HOUSTON – “You can’t fix anything until insurance comes through. Well, we haven’t heard anything from insurance, so how do you keep moving on? You’re just frozen.”

The sentiments of Jeni Kite are common for many in the aftermath of Harvey. 

Talk to anyone in Rockport and Port Aransas and they will tell you rebuilding is at a virtual standstill.

“It’s so slow it’s unreal,” is how David Lee describes the process.

The culprit according to them?

Not so much Harvey, but rather TWIA, the Texas Windstorm Insurance Association. TWIA is an insurance provider serving counties along the Texas coast with more than 234,000 policies totaling $67.6 billion.

TWIA policies only cover wind and hail damage.

While their mission statement touts being committed and reliable, policy holders like Kevin Baker in Rockport told Channel 2 Investigates they have been anything but that.

“I’m on my third claims examiner, my second field adjuster and I have yet to receive their report,” he said.

Baker is not alone.

Kite said TWIA does not have answers — even after an adjuster came to their home and told them to gut it.

“We went to get the information, the adjuster didn’t turn it in, they thought maybe, he took off maybe he moved on we don’t know,” she said.

TWIA scheduled a new adjuster for Sept. 25.

There was one problem, though.

“I have not heard a word from him,” said Kite while standing in the skeleton frame of what is the first home she purchased.

It all comes as blue tarps are now landscape fixtures. Public adjusters like Clay Morrison out of Kemah said TWIA has failed to deliver for customers who paid policies for years.

“We have a lot of files down in Port Aransas and I know numerous people down there and very few have even gotten their first check a month after the storm,” he said.

Morrison represents home and business owners when insurance companies fail to step up.

He is also the former president of the Texas Association of Public Insurance Adjusters, and while he and other adjusters like David Lee are shocked by what they say are grossly low estimates, they say they are more stunned by the actions of private onvestigators hired by TWIA, “I’ve been through several of these storms and I have never, ever seen an investigation unit like this.”

TWIA admits it has been working with Veracity Research Company (VRC) Investigations for years — to investigate fraudulent claims. However, Channel 2 Investigates discovered these private eyes are asking to see contracts between public adjusters and the clients who hired them, “My problem is if they are a private investigation group, they have zero authority in any kind of process of getting any kind of information like that.”

Several Public Adjusters tell Channel 2 Investigates this is simply harassment to disrupt the process and ultimately delay a payment. Morrison says it is also TWIA wasting its customers’ time, many of whom have paid thousands in premiums over the years, “I don’t know why they would be investigating the claims themselves when there are so many people with so much damage that need so much help, it seems counterproductive to me.”

Kite is one of those waiting for help, while she and others feel they should be moving forward at time when their lives are turned sideways, stopped dead in their tracks.

“A normal day is so far out there that you can’t see a normal day coming and that breaks your heart,” Kite said.

In response to Monday night’s report, the Texas Department of Insurance reached out to Channel 2 Investigates to assist in informing the public to contact the following if they are having troubles with their insurance carriers:

  • Texas Department of Insurance Consumer Help Line: 1-800-252-3439
  • Click or tap here to learn how to how to file a complaint

TDI wants to ensure that individuals receive the proper assistance. They also state that those calls and complaints will help TDI monitor how claims are being handled.


Struggles, uncertainty continue for TWIA policyholders affected by Harvey

ROCKPORT, Texas – If one surveys the scene in Rockport, a common image emerges: homes blanketed with blue tarps.

The tarps are tied down in such a manner that they resemble architectural Band-Aids for the wounds absorbed by so many during Hurricane Harvey.

Channel 2 Investigates recently returned to the storm-ravaged area after we first exposed the problems facing Texas Windstorm Insurance Association policyholders in October.

Homeowners said adjusters came and went. “I have not heard a word from him,” they said.

Now, two months later, challenges persist for longtime TWIA customers, such as Craig Griffin.

“Obviously, the insurance money is moving pretty slow and that is holding us back,” Griffin said.

Griffin is on his second adjuster, but he tells Channel 2 Investigates that he dipped into his personal rainy day fund to cover what he says is a financial drought from TWIA.

“You know, the field adjusters came out and they all told a pretty good story that things are going to get done and that we are going to make you whole again, and then it all kind of falls apart,” he said.

A few miles away, Ed Rainwater said piecing life back together has been a long process.

Rainwater’s home is insured by TWIA, the only insurance option for the vast majority of coastal property owners. The agency finally provided Rainwater with a check before Thanksgiving, but he told Channel 2 Investigates it was only after multiple adjusters had been assigned to him.

“We have people all over town that have nightmare stories and we were one of those up until we got our third adjuster,” Rainwater said.

State Rep. Todd Hunter is familiar with the storyline.

“They are either getting a small amount or no attention, or personnel is changing so the same person isn’t coming back and it’s being delayed,” Hunter said.

Hunter admits he also has heard frustrations over lowball estimates.

“What I am hearing is: The assessment of what the damage is doesn’t seem to be what really the damage is. It seems to be a little low on the evaluation,” he said.

When asked why the lowballing of estimates is allowed, Hunter quickly responded, “I don’t know and we need to look into it more.”

That’s a strong statement, considering Hunter once had a professional relationship with TWIA.

“I have been a lobbyist for them,” he said.

Hunter lobbied for TWIA over 10 years ago, but said he will investigate his former client if the slow paying of people’s lives, as he calls it, continues.

“TWIA needs to be looked at,” Hunter said.

Seth Chandler, an insurance law professor at the University of Houston, said TWIA is in the middle of its own financial storm.

“They are not particularly well-funded,” Chandler said.

TWIA told Channel Two Investigates that, as of Dec. 5, it had approximately $1 billion in cash on hand, with an additional $3.9 billion available to help pay the more than 73,000 Harvey-related claims.

The agency said it is financially stable, however Chandler countered that its business model is anything but, due to the rising cost of providing insurance.

“They are caught in a debt trap they can never escape because the money they would like to squirrel away to pay claims is now being pumped overseas to reinsurers to keep their finances afloat,” Chandler said.

Money is what Craig Griffin needs to get his life back on track. He’s waiting, knowing he’ll have to keep fighting.

“This is my life and I’m going to get paid. Right now, I am not getting paid for everything, but it’s my life and I want to get it back,” Griffin said.

While property owners like Griffin said they are going to keep fighting, TWIA says it has paid more than $863 million on 57 percent of the claims post-Harvey.

The company also said its goal is to pay every dollar owed on a claim under the terms and conditions of the policy.

Channel 2 Investigates asked TWIA for a sit-down interview with its general manager, John Polak, but TWIA would only agree to the interview if we provided all of our questions in advance.

When Channel 2 Investigates informed TWIA that we are not in the business of giving our questions before our cameras are rolling, TWIA sent us an email stating, “We are declining your in-person interview request at this time.”



After Harvey, Texans Slammed by New Storm: Delayed Insurance Claims

For complete video story click here

You pay your premiums faithfully, are never late, and bought into the promises made by your home insurer that you would be protected in the event of an emergency. Along comes a hurricane of epic proportions – Harvey had 130mph sustained winds, an enormous storm surge, and dropped several feet of rain in a relatively short period – and you lose everything. “But,” you think, “at least I’m insured. Everything will be fine.” Sadly, that’s not proving to be the case for many people. Delayed insurance claims are the new storm slamming Texans.

Texan Jeni Kite told KPRC2 in Houston, “You can’t fix anything until insurance comes through. Well, we haven’t heard anything from insurance, so how do you keep moving on? You’re just frozen.” As of two days ago, nothing had changed for Kite. Even though an insurance adjuster had already inspected her home and advised her to “gut it,” she’s still waiting for help.

She said, “We went to get the information, the adjuster didn’t turn it in, they thought maybe, he took off maybe he moved on we don’t know.” So, her insurer, the Texas Windstorm Insurance Association (TWIA) arranged for another adjuster to inspect the damage on September 25. According to Kite, “I have not heard a word from him.”

Rockport resident Kevin Baker isn’t faring much better. Despite TWIA’s mission statement, Baker told Channel 2 Investigates, “I’m on my third claims examiner, my second field adjuster and I have yet to receive their report.”

TWIA’s website states that it “is a residual insurer of last resort and is not a direct competitor in the voluntary insurance market. TWIA provides coverage to residential and commercial properties in certain designated portions of the Texas seacoast territory. The designated catastrophe area is that portion of the seacoast territory where the Commissioner of Insurance has found that windstorm and hail insurance is not reasonably available.” TWIA issued over 234,000 policies totaling $67.6B.

Harvey as seen from the International Space Station; image courtesy of
Harvey as seen from the International Space Station; image courtesy of
Clay Morrison, a public adjuster whose experience “includes adjusting claims in every major hurricane of the last two decades,” helps home and business owners when insurers drag their feet. Morrison told Channel 2, “We have a lot of files down in Port Aransas and I know numerous people down there and very few have even gotten their first check a month after the storm.”

Morrison and fellow adjuster David Lee are surprised by what they consider to be “grossly low estimates.” Additionally, TWIA is working with Veracity Research Company (VRC), “an investigative professional service firm specializing in all aspects of insurance defense investigations,” another move that surprised Morrison.

He said, “I’ve been through several of these storms and I have never, ever seen an investigation unit like this.” One of the issues he has with VRC is something Channel 2 Investigates discovered, which is VRC’s people asking policyholders to see the contracts they have with public adjusters. Morrison said, “My problem is if they are a private investigation group, they have zero authority in any kind of process of getting any kind of information like that.”

Indeed, Channel 2 Investigates was told by many public adjusters that “this is simply harassment to disrupt the process and ultimately delay a payment.” Morrison concurs, adding, “I don’t know why they would be investigating the claims themselves when there are so many people with so much damage that need so much help, it seems counterproductive to me.”

An answer to Morrison’s concern could be found by looking at history. Following Super Storm Sandy in 2012, CBS’ 60 Minutes aired a piece called “The Storm After the Storm.” The piece detailed findings of “wide scale fraud where original damage reports were later changed to make it look like the damage wasn’t as bad.” This also happened after Hurricane Katrina back in 2005. The issue then was wind vs. water claims. The difference? Who pays the claims.

In cases of wind vs. water, some engineering reports were found to fraudulently identify the cause of property damage as water, instead of the real culprit, wind.

For TWIA, a finding of water damage lets the company off the hook. Its policies don’t cover anything but wind and hail damage. So, who does cover flood damage? The National Flood Insurance Program (NFIP) offers flood insurance. The NFIP is managed and underwritten by FEMA, the Federal Emergency Management Agency. Policies must be purchased through an agent as the NFIP doesn’t sell policies directly.

The NFIP is facing its own challenges. The program is heavily in debt due to Sandy and Katrina payouts and has a cap on how much money it can borrow from the government. During an interview with the Corpus Christi Caller Times on September 4, “FEMA Deputy Associate Administrator Roy Wright, who oversees the nation’s flood-insurance program, said he expects Harvey payments to climb well above the $7.5 billion immediately accessible to the cash-strapped flood insurance program.”

However, he added, “I am confident that Congress will pay this bill in full.” Even so, FEMA expects the claims payout process to take up to one year to complete. Discussions in Congress are ongoing to determine if anything can be done to speed up the process, as well as examining potential reforms to the program.

Back to wind claims, what can you do if TWIA (or any other insurer) is dragging its feet on paying your claims? Dan Karr, CEO and founder of ValChoice, a site providing free reports on home and auto insurance, has some ideas that he recently shared in an OpEd piece for Fox News.

Karr discussed the most common means of handling insurers’ delays in paying claims: lawsuits and arbitration. While these means can be quite successful, if they end in a settlement, the parties typically enter a mandatory confidentiality agreement. Karr’s take on such agreements is that they do more harm than good as they keep other consumers in the dark regarding the misdeeds of their insurers. Given that regulation and legislation have also failed to correct the problem, he suggested a new approach: transparency. He believes that transparency will have “little cost and will be highly effective.”

What does this new approach look like?

In his words, “Public embarrassment is a powerful tool, and the insurance industry has been shielded from public accountability for too long. Texas regulators need to encourage homeowners to file complaints with the insurance department when they don’t get the service they expect from their insurance company. Regulators need to quickly vet these complaints. Once vetted, complaints need to be published and publicized. The publication of the data will inform consumers in Texas, and across the entire country, which insurers do not honor the promise to protect that is implicit with insurance. Texas regulators also need to publish their findings from market conduct examinations. Regulators routinely perform market conduct examinations, but the findings are considered confidential.”

Karr’s new approach is novel in the insurance industry, but not in other consumer-focused areas. We know that businesses, such as retailers, depend as much on public opinion for their success as they do on clever marketing campaigns. Many people refuse to do business with companies that have consistently low ratings from other customers.

As Karr said, “When carriers realize they will lose customers across the entire country if they do a poor job of protecting policyholders in Texas, two important events will take place. First, the service Texas homeowners receive will improve. Second, insurance companies will start to measure their performance based on data available to the public. This will have a powerful, positive effect on both consumers and the industry.”

It’s a good idea, with proven results found in other fields. One potential drawback, especially for those in coastal areas, is that other options may not be readily available. While there are some private insurers offering flood coverage, for instance, most policies are underwritten by the NFIP. Policies covering wind damage, other than those provided by TWIA, may also be hard to find.

In the meantime, despite Karr’s opinion on the mandatory confidentiality agreements typically required with settlements, those homeowners left waiting for help may best be served by contacting a reputable law firm. Additionally, consumers should file complaints with the Texas Department of Insurance Consumer Help Line. This can be done by phone at 1-800-252-3439 or online at

Insurance company accused of delayed response to storm claims
Houston, we’ll have a problem — insurance companies that won’t pay
FEMA flood insurance program begins to pay Harvey claims as expiration date looms



Many (including our office, our followers,our local representative, etc.) have been working to get TDI to extend its deadlines sooner rather than later for Harvey claims and just yesterday afternoon the Texas Department of Insurance published Bulletin #B-0033-17. They have officially extended the deadline to dispute your TWIA claim based on reasons that we have been trying to express loud and clear. I have included the link to the bulletin here below. Further below is the link to the Commissioner’s Order along with a portion of the language in the Order.



Below is the section of the order that addresses the reasons why the deadline was extended. We don’t believe 120 days will be long enough for a catastrophe of this size, but it’s a start.



Commissioner’s Order- IN PART**

  1. Under 28 TAC §5.4222, good cause exists to extend the deadline for TWIA claimants to demand appraisal for claims arising from Hurricane Harvey. Good cause exists based on
  • the number of claims TWIA has received arising from Hurricane Harvey, and
  • the reasonable anticipation of
  •  a shortage of qualified contractors in the affected areas that could promptly bid out work for the damage TWIA accepts,
  • fluctuation in prices for labor and materials in the affected areas, and
  • the potential that claimants will not reasonably be able to dispute

TWIA’s payment determinations within the time required by

Insurance Code §2210.574.

  1. The deadline for a claimant to demand appraisal for disputes about the amount of loss TWIA will pay on claims arising from Hurricane Harvey should be extended 60 additional days. With the additional 60 days, a typical claimant will have a total of 120 days to demand appraisal after the date the claimant receives TWIA’s required written notice accepting coverage in full or in part.


Good morning folks, if you have an insurance policy with TWIA, right about now or in the near future you will be getting a letter with one of the two following headings or a variation of the two combined:

  1. “Notice of Claim Acceptance”
  2. “Notice of Claim Denial”

These two letters are dramatically different in nature but they will both go on to explain when your claim was received, the claim issues you noted and note specifically other observed damages. The letter likely includes  documents which detail what to do if and when you make repairs, legal notices, what to do if you disagree with the payment amount, frequently asked questions about appraisal and an appraisal request form.  On the page titled “If you disagree with the payment amount”, there will be a bold underlined phrase stating: “All disputes concerning the payment amount for an accepted claim under your insurance policy must be resolved through the appraisal process”.   A little further down you will likely see a statement that says: “Please be aware that if you do not request appraisal within the time period above, you waive your right to contest TWIA’s determination of the payment amount.”

History behind the changes: What I am about to share with you will have you fighting mad and it should.  A couple years ago the Texas legislature passed a bill providing a massive number of protections and special conditions for TWIA.  So that you will fully understand the gravity of the protections that were given to the insurers I will explain.   Once you receive the letter above from TWIA, you only have 60 days from the date of that letter to demand appraisal.  If you disagree, as an insured, you are now forced to use the appraisal process and you are forced to pay for it out of pocket.  In a nutshell, appraisal is a process that is used to resolve disputes related to claims’ amounts, whereby you hire an appraiser, the insurer hires an appraiser and the two appraisers either agree on a third party umpire who decides the differences or have an umpire appointed by a local court if the two appraisers can’t agree on the umpire.  Appraisal is normally a very good option for resolving disputed claims, however, it is limited under TWIA policies.   Appraisal in most standard policies provides that both parties have the right to petition the court for an umpire appointment if the two appraisers cannot agree on an umpire.  However, if you have a TWIA policy, end up in appraisal and the two appraisers have to get an umpire assigned, the umpire is picked by the Texas Department of Insurance from an “approved umpire list”.  Here is the bad news about the “approved umpire list”.  If you work under the direction of insurers day in and day out you can be included on the list.  However, no one who is working for an insured as a public adjuster at the time of TWIA approved umpire list renewal is approved. The bottom line is that the TDI approved umpire list is apparently full of folks who represent insurer’s every day, but anyone who may happen to represent an insured at the time of their license renewal is refused admission to the list.

The 60 days: You only have 60 days from the date of the letter above to take action.  If you demand appraisal, you are forced into an appraisal process that you have to pay for out of pocket that limits your rights and recovery.  If you don’t demand appraisal, or you simply miss paying attention to the 60 day time limit, you are done and your claim is finished.  According to TWIA, failure to meet this 60 day time frame will result in you losing all rights to contest your claim.   I have an actual client who received his letter, was unhappy, hired us, we notified the insurer and they dispatched an engineer who may not have a report for weeks.  Potentially, as this stands, TWIA can acknowledge your claim in a delayed fashion, your adjuster can state the he is three weeks behind before showing up (as ours did), the insurer can dispatch an engineer to re-evaluate your claim once you question it, they can correspond at their own speed thereby delaying your claim, 60 days can pass and you are out of luck.  Wow – I could not make this up if I tried!  Perhaps you should start calling your senator and state representative and urge them to extend the response periods under the TWIA policy in light of this declared catastrophe.  If not, this could become the second catastrophe from Harvey.  For more information on these claims issues visit our website at:  As always if you have questions about your rights or the time periods in YOUR specific claim, seek the advice of legal counsel. Make sure to watch for a Texas Department of Insurance bulletin regarding an extension of these time periods.




My timing on providing this information was intentionally delayed until now because the time has arrived when you are bound to start seeing this document crop up. This one little document (the POL) can set the stage for everything that occurs on your claim going forward, it can cause a denial of your claim, it can destroy your claim if not filed or not filed on time and it can also be the root of all leverage you have to start the clock moving and to force your insurer into taking action. Whatever you do, file this form timely, file it accurately and don’t file it until you know the amount of loss you are claiming.

If any insurance adjuster asks you to sign one of these forms make sure you have confirmed that everything on the form is 100% accurate and this is especially the case on a flood claim. Some insurance adjusters will attempt to secure your signature on one of these forms even when you may not agree with the amount of loss by stating: “just sign this POL and you can always supplement later”. As the name implies, this is a sworn document and it may be used against you. Some insurance adjusters are not allowed to turn in their file and bill for their time until you have signed a proof of loss so there is an incentive for them to work with you to get it right.  As the title of my post implies this will be the most important document you will sign, so I will start by giving you the basic components of a proof of loss and then I will then outline time frame requirements of several types of POL forms based on the insurer.
POL documents typically have the following information on them:

  1. The date of loss.
  2. The type of loss (ie flood, wind, etc)
  3. The insurance policy number
  4. The insurance claim number
  5. The address of the loss
  6. The use of the property (ie dwelling, business etc)
  7. The mortgage company
  8. Coverage amounts at the time of loss
  9. Anyone having an interest in the loss
  10. A place for you to sign and sometimes a spot for a notary
  11. Finally, there will be some scary language at the bottom of many that warn you against defrauding insurance companies.

There is not one form that fits every situation and they vary widely depending on the policy and policy language. The flood claim POL is very different than a TWIA POL or and that is very different from a standard homeowners POL. In almost every case you will find the requirements of what has to be included on the POL within the language of the policy. You will also find within the policy language, the time frame within which you must file a POL. Unfortunately most POL language is buried in the middle of the policy in a benign looking paragraph. Because this is such a key component to a claim, our company has long petitioned folks in Austin to make insurer’s put this language on one of the first few pages of the policy in big bold print so you can’t miss it and I have often wondered if burying the language in the middle of the policy is intentional, the old saying “it’s in the fine print” …but that is a discussion for another day.


TWIA: Texas Windstorm historically had a requirement that you file your POL within 91 days of their notice of claim acknowledgement. When you filed your claim you should have received a letter confirming your claim. Typically you would have 91 days from the date of that confirmation to complete and file your POL. TWIA was granted this time frame by the legislature a while back and it is in no way sufficient in times of a catastrophe. However,  TWIA has now waived the POL requirement and removed this time frame from the policy.

FLOOD: The standard flood policy has a requirement that you submit your POL within 60 days from your date of loss. In plain language you have 60 days from the date you flooded. Unless NFIP (the National Flood Insurance Program) waives this time frame and extends this in writing, you must meet this deadline. If you blow this, you may be forever barred from recovering. However, I have some very good news for you. The NFIP has not only waived the requirement for a POL within 60 days, but you can now use it as a tool to petition for more funding if you don’t agree with the amount of loss allocated by your initial adjuster and you now have up 365 days from the date of loss to file this document. Additionally, FEMA has loosened the requirements concerning signing your adjuster’s initial report.…/femas-national-flood-insurance-progr…

HOMEOWNERS: The POL requirements for time frames vary widely depending on the carrier. Review each policy on a case by case basis to determine what your policy may have. Generally, look for the portion of the policy that says “your duties after a loss” or the “loss payment” sections and you can usually find the POL requirements there. Again, these policies vary as to where this language is located.
The POL can be a complicated and potentially a game changing document when you have flood, wind or overlapping issues. If you have questions you can contact us at and we will do our best to answer them:

Unfortunately with our work load growing we may be slow to respond individually but we will do our best to get you the answers you need and I will continue to equip you with the knowledge I have gained from years past as a consultant to one of the largest insurers in the world and my current 20 years as a public adjuster. Disclaimer: At times the POL situation can meld into legal situations and we advise you to consult an attorney if there is any hint of this.

My upcoming posts will address what to do if you don’t agree with your adjusters assessment, what to be prepared for when the insurer sends out a “consultant” or engineer, what to do if your proof of loss is rejected, the subject of Co-Insurance and the topic of demanding appraisal, which you will probably see a lot of as this storm progresses. We will also be posting a comprehensive resources page for you.
Our extended family has place in PA and my wife and I have been bringing our kids there since they were young. The house was damaged and we are waiting in line to deal with our claim just like all of you.



This evening I will be taking the mystery out of one of the biggest issues you will be facing when it comes to water damage. Wind driven rain is probably the single biggest contributor to damage in a hurricane other than the storm surge itself. This topic is one of most hotly contested issues of all time when it comes to insurance coverage and I can assure you that once I am finished you will be equipped to take on this issue. It should be obvious that if you have a gaping hole in your roof or walls after a hurricane you can expect to be covered for interior water damage. However, what if you have water damage to the interior, but you can find no permanent holes in your structure? This is where is where it gets interesting. Most policies require an opening to be created in the structure for wind driven rain to be covered, however most policies don’t specify that the hole in the structure has to be permanent. Let that sink in for a moment. During a hurricane, incredible wind pressures are exerted upon a structure that create “openings” that would not normally exist outside of the hurricane event. What I mean by this is items such as windows, doors and other locations can be distorted by pressures that exceed the design ratings of these items thereby causing them to distort in shape and create temporary openings. Whats the bottom line— openings in the structure are not always permanent and not always gaping holes. Sometimes they are temporary and unless your policy specifies that the openings must be permanent, you should be entitled to coverage for damage caused by the temporary openings just like you are covered for the permanent openings. If you are insured with TWIA and have a “320” endorsement, it does not matter whether the openings are temporary or permanent- you are covered! The moral of the story is to always ask your agent for wind driven rain coverage. In many cases, this coverage is worth more than the wind coverage itself.

Port A Happenings Post 2017

IN AN ONGOING SERIES OF HARVEY INFORMATION YOU REALLY NEED TO KNOW ABOUT THIS: I need to share what is happening with windstorm claims along the coast. While I was in Port A, an older gentleman showed up at our neighbors house wearing a lanyard and ID badge that said Crawford Adjusting and Farmers Insurance on the label on the ID card. He approached me because he was confused as to the correct address he needed and I assisted in informing him that he was looking for our next door neighbors home. A conversation ensued, he told me he was an insurance adjuster and after a few minutes he figured out that I knew way too many terms so he asked what I did for a living. When I told him I was a public adjuster he did the usual slight recoil in posture, but then proceeded to tell me that he was interested in becoming a public adjuster and switching sides because he was tired of the dishonesty within the insurance companies. He continued and told me that he was not there to adjust the claim and provide a check for the insured to start repairs, but only there to document the damage to report to the insurer and that another adjuster was coming later. Unsolicited, he continued telling me that his information was being gathered to be used to “screw the insured down the road” as the claim ages and further that while he did not like his job but that was what he was assigned to do and it was common knowledge among his adjusting group. I am quoting him and not paraphrasing so forgive my language. Just so it’s clear, this first claims adjuster was not sent out to adjust and pay the insured, but to document damage to be used against the insured down the road. I don’t know if this is criminal, but it’s certainly egregious and disgusting. While people are living in shelters, at least one insurer is putting the gathering of data ahead of adjusting claims. As a public adjuster the insurance industry often labels me as the dishonest guy who is responsible for taking advantage of people and driving up rates. If the discussion of taking advantage of people is in play, some insurance companies might need to take a look in the mirror. If you are a policy holder you need to be alert.

Hail Storms, Wear and Tear, and Inadequate Maintenance

Hailstorms are wreaking havoc as noted in Brandee Bower’s post yesterday, Greetings From Hail Alley. After contacting their insurance companies, some policyholders unfortunately find their insurance companies deny the claims based on exclusions in the insurance contract involving wear and tear as well as inadequate maintenance.

To be fair, roofs get older and there is always wear and tear on older roofs. Rarely are close up pictures taken of roofs taken just before a hailstorm occurs. Accordingly, changes in the condition of some roofs caused by the winds and hail in a hailstorm versus pre-existing wear and tear become an issue.
My impression is that many insurers are increasingly claiming exclusions caused by wear and tear as well as inadequate maintenance. Indeed, insurance company engineering firms are increasingly advertising their services for these issues. There is nothing unethical about this, but the trend is landing many hailstorm losses into denials and subsequent litigation.

An excellent case regarding these issues is Monterra Apartments Ltd. Liability Partnership v. Sequoia Insurance Company.1 Sequoia denied that the hailstorm damaged the roof and claimed that the damage was wear and tear or inadequate maintenance. Regarding these issues, this is what the court found:
The policy clearly and unambiguously excludes coverage where wear and tear is the sole cause of damage. The last sentence quoted above clearly states, however, that the exclusion of coverage in Section I.B.2.1 does not apply—in other words, the policy provides coverage—where an “excluded cause of loss” results in a “specified cause of loss.” The phrase “specified cause of loss” is defined in Section I.H.11 to include “hail.” Therefore, replacing “excluded cause of loss” with “wear and tear,” and “specified cause of loss” with “loss from hail,” the clause reads: “if [wear and tear] results in [loss from hail], we will pay for the loss or damage caused by that [hail].” Thus, when wear and tear contribute to damage by a hailstorm, the policy provides coverage for the hail damage. Further, the policy covers any ensuing damage from the hail, such as water penetrating the roof as a result of the hail.

…The “Covered Cause of Loss” can be stated as “hail” or “loss from hail” because hail presents a “risk of physical loss” and is not excluded by the policy….Using these substitutes, the key provision reads: “if [inadequate maintenance] results in [loss from hail], we will pay for the loss or damage caused by [the hail]. This produces the same result as the wear and tear exclusion discussed above. Thus, when inadequate maintenance permits hail damage to occur, the policy provides coverage for the hail damage.
The parties dispute whether hail or inadequate maintenance damaged the roof or resulted in moisture penetrating the roof. This factual issue is for the jury.
The bottom line is that the insurance company better be prepared to show that all the damage was caused by pre-existing wear and tear or that all the damage resulted from inadequate maintenance. Sometimes that is the case. But in many cases, older roofs having wear and tear are also torn up by the winds and hail stones which are occurring much more often today.

1 Monterra Apartments, LLP v. Sequoia Ins. Co., 2012 WL 827075 (D.Ariz. Mar. 12, 2012).