A Spring Hill, Florida, resident says he is struggling with a state-backed insurer after his nearly six-figure insurance claim was denied.
Tom Luby told WFTS Tampa Bay 28 that Citizens Insurance denied his vandalism claim twice, totaling nearly $100,000, for damage to a rental property he owns. According to WFTS, the insurer determined the extensive damage resulted from an “incomplete remodel” by the tenant rather than vandalism.
The damage includes stolen and destroyed appliances, torn-up floors, and debris scattered throughout the home and surrounding property.
Because of Florida’s insurance reform laws, Luby says he cannot take the insurer to court. After two denials, his case must go to mediation. He said he contacted three different attorneys, all of whom declined to take the case.
“They don’t want to take it, because you can’t win,” Luby said. “There’s nothing I can do.”
Understanding Florida’s Insurance Reform Law
Critics have raised concerns about the mediation process, which routes disputes with Citizens Insurance to arbitration through the Florida Division of Administrative Hearings instead of Florida’s circuit courts.
A recent ProPublica investigation reported that lawmakers and Citizens supported the 2023 change, saying it would speed up hearings and reduce costs. However, the report noted that some DOAH judges have denied requests to disclose potential conflicts of interest while serving as arbitrators.
Miami-based attorney Anthony Lopez, who represents Luby in mediation, questioned the neutrality of the process.
“The neutral arbitrators, the judges in DOAH, are basically hand-picked by Citizens. A lot of them are former defense lawyers that represented insurance companies,” Lopez said.
According to ProPublica, Citizens won more than 90% of over 1,500 disputes sent to mandatory arbitration. By comparison, the insurer prevailed about 55% of the time in circuit court trials over the past five years.
The investigation also highlighted that homeowners who attempt to withdraw their cases may be unable to do so unless both parties agree. ProPublica reported that Citizens routinely seeks fees and costs from individuals who do not exit the process early, a practice one attorney described as “vindictive.”
Citizens CEO Tim Cerio defended the mediation system in an interview with WFTS, saying claims undergo a six-step review before reaching a DOAH hearing. He added that 37% of disputed claims sent to DOAH are settled before a final hearing.
“We’ve tried very hard to get it right, and if we think we’ve made a mistake, to go back and fix it,” Cerio said. “By the time that final hearing comes, we are pretty certain about the outcome.”
Following the interview, Citizens said it would review Luby’s case again, according to WFTS.
What to Do If Your Insurance Claim Is Denied
Homeowners concerned about coverage or the possibility of a denied claim can take several steps to protect themselves.
Start by carefully reviewing your insurance policy to understand what is covered and what is excluded. Common exclusions often include flooding, earthquakes, landslides, insect or rodent damage, war or civil unrest, normal wear and tear, and damage caused by neglect, such as mold or unresolved leaks. In some cases, separate policies may be required for certain risks, including flooding or natural disasters.
When filing a claim, make sure it is submitted within the deadline outlined in your policy. Document all damage thoroughly with photos, videos, receipts, and other supporting evidence. Avoid making major repairs until an insurance adjuster has inspected the damage.
If your claim is denied, contact your insurer to request a reevaluation and keep detailed records of all communications. You may also file an appeal, following the process described in your policy.
Homeowners can also reach out to their state’s insurance department for guidance or mediation assistance. Another option is hiring a public adjuster, who works on behalf of the policyholder rather than the insurer. Public adjusters typically charge a fee of up to 15% of the settlement.
Before hiring a public adjuster, confirm they are licensed in your state, check references, and review any limits on fees set by state law. Be cautious of individuals who pressure you into signing, especially after natural disasters, as consumer advocates warn against door-to-door solicitation.
This article has been carefully fact-checked by our editorial team to ensure accuracy and eliminate any misleading information. We are committed to maintaining the highest standards of integrity in our content.
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