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Citizens Insurance faces class-action lawsuit over home valuation practices

Citizens Property Insurance Corp. is facing more heat over its system for valuating replacement costs for homes.

Two groups have filed a class-action lawsuit against the state-run insurer, claiming that Citizens is using a software program, called 360Value, to overvalue the replacement costs of homeowners’ properties.

Florida Association for Insurance Reform  and the Beausoleil Law Group of Florida, who filed the lawsuit, charge that Citizens has used the 360Value system to raise rates on homeowners and “side-step” the legislative process for rate-raising.

Last year, Citizens told agents it would rely solely on its 360Value software for estimating the replacement cost of homes, and would no longer take into account estimates from real estate appraisers or independent general contractors. That sparked several complaints from homeowners who said their homes were being overvalued by the software.

A couple weeks back, Citizens reversed course on that decision.

The about-face came just days after a Tampa Bay Times story that documented seemingly high replacement cost values reached by 360-Value.

Still, plaintiffs are arguing that the giant insurer is using the system as a backdoor method to raise rates. Sen. Mike Fasano, R-New Port Richey, will join plaintiffs at the steps of the Old Capitol in Tallahassee on Tuesday afternoon to announce the lawsuit.

From the class-action lawsuit website

“Citizens has been and wants to continue increasing revenue and reserves without having to fight the Florida legislature for a rate increase.  They are literally sidestepping legislative action at the expense of the almost 1.5 million Florida taxpayers that are being forced to pay higher premiums because Citizens intentionally misrepresents property values.”

 

Comments

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Jack Thomas

There's a difference between the market value and replacement cost and that is what most people fail to take into consideration. But the more important question is whether a policyholder would be more happy because they purchased a little extra coverage or less happy if they did not purchase enough?

gatorcane

Citizens policyholders are already being subsized 40% -50% by other Floridians. Now these folks sue because they only want to insure to market value to lower their premiums even further (at least until the next hurricane when they'll sue again because they are underinsured). The cost of this lawsuit will again be shouldered by all Floridians in the form of assessments. This is nothing but pandering by Sen. Fasano in his soon to be announced run for Congress.

jay anthony

Pandering? If Citizens rates need to be adjusted do it through the front door not the back. This is not an issue of being slightly overinsured. This is saying modest homes being built and sold today for $130,000 are being listed with $240,000 replacement values. These people have no other choice besides Citizens. This is extortion, plain and simple. Gatorcane, what insurance company do you work for?

Rich V

My home is insured through citizens but not by choice. The replacement cost with my builder is three times less than citizens mandates I pay for coverage. My home is also valued less with my town than new construction. If my home is worth $127K new today, why am I being forced to pay replacement coverage at $425K? I only paid $118K new
Seems to me I am paying way to much and they also are trying to raise my rates even more.

Brian Murphy

Citizens is getting out of the insurance business. If you want choices call us at 561-598-6300. Citizens is not in our top 10 companies we put our clients with. Oh and we are the largest independent agency in Florida.
Send your declarations page to homequote@murphysbrightway.com

M. Rivera

What I want to know is, if Citizens has my policy at $186,000, and if my house (appraised at 80k) gets totally destroyed, does Citizens pay me $186,000???

Thomas Lawrence

I'm having the same issue with Sunshine State,my premiums have doubled since last year. one more way to squeeze the consumer. If we had hurricanes in the past few years it might be justified.

Gloria Pintado

my house insurance was raised by Citizen $500.00 this year and they also doble the price on my home value I wanted to know how can i be one more in your lawsuit

Gary Tyler

My home's market value $70,000. My Insurance premium just went up 30%. They are forcing me to insure it for $160,000. The homes next to me sold for $50,000 last year. This is an absolute rip-off simple as that. Extortion as simple as that. As soon as the mortgage is paid off I will go without it. I am sick to death of them ripping me of knowing that I would never recieve the $160,000 upun a total loss. gttyler@cfl.rr.com

Vee

I paid 52,000 for my home in 1999. I have refinanced twice and my interest rate has lowered almost 3% since I purchased, yet my escrow payment has more than doubled. Citizens has my home valued at 176,000. When I questioned that number they told me that because my home was in a "historic district", if something happened, they would have to rebuild it exactly the way it was now...meaning they would have to use "wood and stucco". In the meantime, the house on the corner burned down and was rebuilt with concrete block. As for being underinsured--if something happened, and I could get just enough to pay the bank, I would be grateful for that, rather than to lose my home because I can't afford to pay insurance costs, which is where it seems to be headed.

miguel

Funny thing is that insurance companies say that full rebuild costs does not corrolate with market value. Sure it does. In my opinion full rebiuld costs must always be below market value or else new home builders will be out of business.

miguel

and that does not take account of land value that is included in market value.

Oklahoma city roofer

you might want to reconsider what you are insuring because the cost to rebuild may well exceed the actual real value of the property or the selling price.


Islphilip

We provide a similar service for Europe, but we ensure that each valuation is undertaken by an expert surveyor following consultation with the client. We are looking to roll out the service worldwide.

Bill Ross

We Insure quite a few Clients. All are "Over insured". We cannot make progress with Citizens!
To rebuild a 3000 ft home in South Florida with a "Builders" level of Quality is at 60-80 dollars per square foot.ie 3000 X 70 = 210,000. This does not include the Land. It does include the Sitework such as Utilities, Slab Foundation and Grading. The 3000 ft home
when rebuilt new will appraise at 20-30 % over local comps. The 3000 ft home at Admirals Cove will cost 150 per square ft since the Quality is several grades higher than others in the County. Agents cannot argue with Citizens but we realize that they are really ripping you off. If you have a "Responsible" Broker he can guide you through the Alternatives Available.ie Mortgage Insurance! ....Bill

Be_shh

If you need help with homeowners insurance in Port St Lucie try going to http://www.accurateinsuranceonline.com/residential.html

linda moore

I guess we are stuck with citizens we have a manufactured home not a trailer no other insurace co will touch these homes its like being singled out because we cant afford a big home.and yet we pay as much for insuane as a big home go figure

jaynee mitcum

I had a reinspection from citizens which took roof tie down credit away as inspector did not get off ladder to look. Also took shutter protection away as they missed a bolt hole for front door so they took away discounts for all windows and doors! Just the cost of wind insurance went from 1600 to 3300.

I hired another inspector got the correct report (cost me 200) and rather then battle with citizens I fired them and went with Universal. Cost was 2100 for wind , fire, theft. Bye Citizens... see you at the class action lawsuit.

devastated Catherine

@jaynee mitcum...us too! The worst part is we had the inspector from Don Meyler when we bought our home and we got our credit for shutters, roof fine, and porch considered a porch...now Citizens sent an inspector again...guess what same company Don Meyler and we lost the above and now the porch is considered part of the roof structure and they are penalizing us for the flat roof. Then there's also the part where Broward County Appraiser assessed the land and structure at 193,000,BUT in typical Citizen's fashion...they say it will cost 320,000 to rebuild. Given that my husband and I both work in the industry and know a rebuild cost wouldn't be that high. So very sick of it, my mortgage has gone up 200 a month.
Does anyone on this forum know how I can join in the class action lawsuit?

John

Ihad my home inspected by Citizens some time ago, have bahama shutters on every opening that pass codes, accordians on my sliding doors, hurricane clips on the roof, Now Citizens came back to re evaluate the home, the person doing the inspection did no appear do know hurricane approved products very well. Well here is what i think they will do increase my insurance again and it is out right fraud in my opinion, they need to be held accountable and be put in prison for many years. They need to be sued, sue the people that are doing this, they must be terminated from there jobs, this is not acceptable what they do and need to be help accountable in front of a judge and hope some powerful attorney will help all the people in Florida and stop this from Citizens insurance

John

I feel sorry for the people effected by Citizens Insurance they have hurt so many people

I to would like to join who ever would like to file a calss action Law Suit, they deserve to be sued and the people doing this should lose their jobs and be held accountable in a court of law

wanda

I would also like to join in the class action. My poor 76 yo old mother's insurance increased $963 on her house built in 1957. Citizens is getting away with ripping florida residents off, we cant seem to do anything about it. Its disgusting!

patricia Kerr

I want to join the class action suit

4autoinsurancequote

With Florida real estate the way it is recently, it's probably better to just skip on the insurance altogether.

Arturo Gonzalez

My home is insured through citizens but not by choice. The replacement cost with my builder is three times less than citizens mandates I pay for coverage. My home is also valued less with my town than new construction. If my home is worth 80.000 new today, why am I being forced to pay replacement coverage at $252.000 I only paid $120.000.
Seems to raise my rates even more.I Pay last year 2,520 last year for insurance. They sent an inspector and he checked my house, as per the inspectors judgement he stated a rediculious insurance increase in my insurance premium. The cost of 3,000.00 dollars more to my original premium which was 2,552.

Read more here: http://miamiherald.typepad.com/nakedpolitics/2012/02/citizens-insurance-faces-class-action-lawsuit-over-home-valuation-practices.html#storylink=cpy

RDB

My structure (home) replacement cost would be 130,000 at best I am rated by Citizens at 230,000. My dirt lot should no be included. Who kidding who? They claim state (FLA)law is dictating the numbers. I call that a joke. I call Citizens a joke.
Can you imagine how they are taking advantage of our older residence who have little fight left in them?
DO SOMETHING ABOUT THIS PROBLEM SCOTT!!!!!!!!!!!

Missy

This goes way back to the Jeb Bush era. He made a very profitable deal with Fl insurers to only insure cars hiking up auto insurance premiums, thus giving birth to Citizens a state created and run corp for those of us that cannot afford or are turn away by the few co that offer it, basically Fla is insured by Citizens. Now our illustrious governor wants to do away with the insurance business and came up with the brilliant idea of inspections as an excuse to hike up prices and make it impossible to afford their premiums that on top of the yearly increase. Posting is great but it will not change the outcome unless floridians/ consumers exercise our right to question our government and hold them accountable, put our foot down and say no more. This is modern slavery we are lucky to keep 10% of our earnings. Criminals dictating and policing the honest, what a turn of a century. We the people yeah right, more like we the slaves.

Missy

Citizens is not a private entity, it is wholy funded and operated by the state, the employees do not make the rules, the one making decisions is the governor and he is very avid on running away with his ideas and changing policies midstream, without regards for any laws. Common practice for the originator of the largest medicaid fraud in the history of USA. Floridians voted for him and gave him a signed blank check.

Punk

Got a letter in the mail from Citizens,no name,
alleging if I don't allow a reinspection I will lose
my credits on my insurance and threatening other charges. I have already had inspections to get my
credits & the state paid for it.I saw where Florida
law says I don't have to, only provide the proof of prior
inspection, & I did. I read in posts the Governor is doing
this, changing the law, illegal. I voted for Scott, he said work with him to end corruption ok people of Florida - "lets get to work".

Happyman

Everyone with Citizens Insurance need to join in on this law sue. They have to be stop. Now . We are the people and our voices need to be heard, this is not right. Citizens are ripping off the people in broad day light. Who say crime doesn’t pay???? Citizens are doing pretty good I would say with the 360 BS. They have to be stop. Come on people let's fight back. We did it before in the 60's we can do it again in 2013.



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