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Citizens insurance: Ignore July 1 changes at your peril

Important changes are coming July 1 to almost half a million Citizens Property Insurance Corp. policies – and they could leave consumers high and dry if they fail to take notice when it comes to problems such as plumbing leaks.

Company officials said this week “to ensure that Citizens has the opportunity to inspect the damage and confirm coverage, the revised policy restricts when permanent repairs can begin.” Permanent repairs mean work after emergency clean-up.

Citizens warned “there may be no coverage” for permanent repairs that begin before one of the following occurs:

▪ 72 hours after the loss is reported to Citizens

▪ the loss is inspected by Citizens

▪ verbal or written approval is provided by Citizens

“Note that these policy contract changes DO NOT require that a loss be reported within 72 hours,” a Citizens statement said.

The company’s initial proposals were revised after a review by state regulators, a company spokesman said.

The point of all this is to address what Citizens says are costly problems with inflated non-storm claims, such as when a pipe leaks and a house needs serious restoration and repair work. Such claims can run into the tens of thousands of dollars, and Citizens is blaming them for rate increases even after a decade without a hurricane.

Citizens remains one of the state’s biggest insurers with just under 500,000 customers.

Contractors and attorneys have battled Citizens and other insurers over attempted restrictions on such claims, and mostly won in the courts and legislature. Now Citizens and others are trying again to toughen rules.

The frequency of water-damage claims in Florida has climbed 46 percent and costs rose 28 percent since 2010, state regulators said in February.

“Unscrupulous trial attorneys and shady home repair firms are responsible,” Mark Wilson, president of the Florida Chamber of Commerce, said then. He stressed abuses can occur when harried consumers sign over insurance benefits to third parties.

Other see a long-running effort “to low-ball consumers and save millions in claims payouts,” as Fort Lauderdale attorney Gary Farmer put it last fall. He could not be reached Tuesday for reaction to the latest announcement from Citizens.

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