Galveston couple blames Citigroup for failing to pay TWIA premiums

John Suayan, Galveston Bureau Aug. 19, 2009, 12:33pm

GALVESTON � A Galveston County couple is suing a subsidiary of Citigroup for failing to pay their insurance premium payment on time.

Garry and Karrie Higgs' breach of contract suit alleges St. Louis-based CitiMortgage mishandled a payment that was essential to the renewal of their policy with the Texas Windstorm Insurance Association.

"CitiMortgage had a fiduciary duty to the plaintiffs to make the insurance premium payments," the suit says. "CitiMortgage breached that duty to the plaintiffs."

The suit was filed Aug. 11 in Galveston County District Court.

Court papers show the Higgs had a homeowner's insurance policy under Nationwide and their TWIA coverage was in effect from Sept. 7, 2007, to Sept. 7, 2008.

According to the complaint, CitiMortgage was responsible for initiating premium payments from an escrow account. The suit states that CitiMortgage was informed by Nationwide in late July 2008 that the Higgs' coverage was set to expire in two months.

Nationwide then established a three-week window for payment.

The plaintiffs claim CitiMortgage did not properly heed Nationwide's request, but CitiMortgage claims it made the payment but accidentally mailed it to a wrong location.

Both Nationwide and the Higgs claim they repeatedly tried to contact CitiMortgage regarding the payment, only to be told by the defendant it was already issued.

The payment finally surfaced on Sept. 10, 2008, a week after the deadline and three days before Hurricane Ike.

Ike, a Category 2 storm, came ashore and inflicted a significant amount of damage to the plaintiffs' residence.

The Higgs say their new TWIA policy did not include the events during Ike and was cancelled.

"As a result, CitiMortgage purchased its own force-placed insurance policy and charged the plaintiffs a higher and more expensive premium," the suit says.

Consequently, the Higgs seek unspecified monetary damages and a jury trial.

Beaumont attorneys Wyatt D. Snider, Jason M. Byrd and Justin G. Sanderson are representing the plaintiffs.

Galveston County 212th District Court Judge Susan Criss is presiding over the case.

Case No. 09CV1440

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