The Johnsons were unhappy about how much Allstate paid them in wind damages to their home at 286 Marina Drive in Slidell, Louisiana. They decided to take Allstate to court.  In reviewing their insurance documents for the case, lawyers found something that shocked them: Allstate had listed higher estimates for repairs if the damage was caused by flood damage than if it had been by wind damage. 


Sheetrock damaged by wind? Allstate was replacing the drywall at 77 cents per square foot.  Sheetrock damaged by water? $3.31 per square foot,or quadruple the cost. The same was true for carpeting, and for texturing and repainting the walls.

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Why would Allstate differentiate?  Lawyer Johnny Denenea says it is because the private insurance company pays for damage caused by wind, and the National Flood Insurance Program, subsidized by the taxpayers, covers damage caused by flood.  The private insurer minimizes its own payouts, and is generous with the federal government’s money.


Denenea found a computer programmer used by Allstate, which designed the software, that sets rates for repairs.  The software, called Integraclaim, cannot be manipulated by the field adjuster.


A representative from Allstate says that costs differ because of the circumstances under which damage occurred.  The cost to repair wet drywall,  for instance, may be greater than to repair a dry drywall.


The Department of Homeland Security, in a September 2008 report found several cases where wind and water determined separate price points, but wrote,  “These differences are not considered significant.”


Check out the following documents and you decide – are insurers bilking the government for money than they deserve? -

“1 - Unit Cost submission-Wind 286 Marina.pdf”

“2 - Unit Cost submission-Flood 286 Marina.pdf”

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Comments (2)

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Sop81_1

March 25, 2009

66.156.167.156

...

So I understand Mr Hartwig right we are not supposed to trust trial lawyer opinions because they have a vested financial interest in suing insurance companies. A reasonable inference from his non-response, especially in light of the fact he is paid to perform public relations for insurers, that his word is not to be trusted either.

Yeah, that is what I thought.

Go get 'em Johnny!

sop

Richard Trahant

March 26, 2009

216.83.244.244

...

I wonder what Hartwig makes per year from this corrupt industry? The "trial lawyer" boogey man is losing its impact, Bob. I don't think too many lawyers handling Katrina claims for property owners make a fraction of what hard-working CEO's like Ed Liddy and Ed Rust rake in per year.

Funny how the one case he is asked about, Weiss v. Allstate, he knows nothing about, despite the fact that it received worldwide media attention. Obviously, this means he really does not know anything about Allstate's and other insurer's claims practices. But we do!

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