Florida Insurers Bilking Customers: Almost Half of Claims Go Unpaid in New Report

Waiting For Insurance CheckPhoto byOCMM

Florida Insurers are Bilking Customers: Almost Half of Insurance Claims Go Unpaid Even After Huge Rate Increases and Legal Protections Extended to Insurers by the Florida Legislature

Fort Lauderdale, FL. - A new scathing report has shed light on the alarming trend of Florida insurance companies failing to pay out claims to policyholders, with nearly half of all claims going unpaid. This staggering statistic has left thousands of Floridians reeling, wondering why they're being left high and dry by the companies they trusted to protect them. According to a recent analysis by Weiss Ratings, three of the state's largest insurance providers—Castle Key Indemnity, State Farm, and Castle Key Insurance—denied payment for nearly half of the claims they closed last year.

The issue came to a head in 2023 as several of Florida's largest insurance providers – including Universal Property & Casualty, Avatar Property & Casualty, and St. Johns Insurance – reported denying close to 50% of all claims filed. This is more than double the national average denial rate for homeowner's insurance claims, which hovers around 20%.

Weiss RatingsPhoto byhttps://weissratings.com/en/weiss-news/weiss-ratings-reveals-large-property-insurers-in-florida-fail

The Scope of the Problem
The analysis revealed that Castle Key Indemnity Company denied 47.1% of the claims it closed, State Farm Florida Insurance Company denied 46.4%, and Castle Key Insurance Company denied 46.0%. This high rate of claim denials is not limited to these three companies. Of the 40 insurance companies operating in Florida, as analyzed by Weiss Ratings, half did not pay on at least 30% of claims. Smaller companies like Kin Insurance Network, American Integrity Insurance Company of Florida, and PURE Specialty Exchange also failed to make a payment on over 40% of the claims they closed in 2023.

Why Claims Are Denied
There are several reasons why insurance claims are denied, including:

• Incomplete Information: Claims often get denied due to missing documents or errors in the submission.
• Aggressive Claims Handling: Insurers are increasingly using aggressive tactics to delay or deny claims, often citing technicalities or policy loopholes.
• Service Not Covered: The policy may not cover the service or repair.
• Late Filing: Claims filed after the policy deadline are often automatically denied.
• Coding or Billing Errors: Incorrect coding or billing information can lead to denials, especially in health insurance claims.
• Perceived Unnecessary Procedures: Insurers may deem certain procedures or repairs as unnecessary.
• Duplicate Claims: Filing the same claim more than once can result in denial.

The Impact on Homeowners
The high rate of claim denials has compounded the hardships for Florida homeowners who are already dealing with increasing property damage from storms and record insurance company bankruptcies. Martin D. Weiss, the founder of Weiss Ratings, stated that this trend is severely impacting homeowner's ability to recover and rebuild.

What Homeowners Can Do
If your insurance claim is denied, there are several steps you can take:

• Review Your Policy: Understand what is covered and why your claim was denied.
• Gather Documentation: Provide additional information, such as photos, repair estimates, and eyewitness statements.
• Contact Your Insurance Company: Discuss the denial with your agent and ask for potential next steps.
• File an Appeal: Most insurance companies have an appeal process. Gather supporting documents and submit a formal appeal.
• Seek External Review: If your appeal is denied, you can request an external review by an independent third party.
• Consult a Lawyer: In some cases, it may be necessary to consult a lawyer specializing in insurance claims.

Moving Forward
The high rate of unpaid claims in Florida highlights the urgent need for reform in the state's insurance market. Lawmakers must address the factors driving insurance costs and ensure that insurers are held accountable for their claims practices. Policyholders also need to be more informed about their rights and options when it comes to insurance claims. Until these issues are addressed, Floridians will continue to face the risk of being left unprotected when disaster strikes.

Thank you for reading this article. I would appreciate hearing what you think. Please hit the LIKE, SHARE, and FOLLOW buttons.

Research and source materials:

Large Property Insurers in Florida Fail to Pay Nearly Half of Homeowner Claims - Weiss Ratings

https://insurancenewsnet.com/oarticle/the-great-ian-insurance-battle-11-million-naples-area-claim-delay-exposes-florida-problem

https://www.thezebra.com/resources/car-insurance/navigating-claim-denials/

https://weissratings.com/en/weiss-news/weiss-ratings-reveals-large-property-insurers-in-florida-fail-to-pay-nearly-half-of-closed-homeowner-claims

https://www.newsweek.com/florida-insurers-stiffing-customers-nearly-half-claims-unpaid-1920669

https://www.thezebra.com/resources/car-insurance/navigating-claim-denials/

https://weissratings.com/