Rita victims sign up here: Insurance suits pour in as deadline nears

By David Yates | Sep 19, 2007

NOAA image of Hurricane Rita

It's not common knowledge, said a Jefferson County District clerk earlier this week, but Hurricane Rita struck twice -- once in September 2005 and then again in the clerk's office.

In the month of September alone, roughly 86 lawsuits accusing marquee insurance companies of "lowballing" Rita victims have been filed in the District Clerk's office.

Most of the plaintiffs in the recent surge of lawsuits have already received a settlement for their policy claim.

But thanks to newspaper and billboard ads paid for by trial lawyers clamoring for civil action against the insurance companies who allegedly forced unfair settlements on unwitting Golden Triangle residents, Rita has regained the momentum she lost two years ago.

"It's unfortunate that there are people (Jefferson County lawyers) that would take advantage of the Rita situation by casting doubt on the (policy claim and settlement) system," said Allstate spokesman Bill Mellander, when asked how his company felt about plaintiff's lawyers placing ads designed to entice locals into suing their insurance company.

"The majority of our (Golden Triangle) customers have been immensely satisfied with our service," Mellander said. "The idea that we would seek to do anything other than provide the highest quality of service is inane."

Mellander said it is much more difficult and expensive to recruit new customers rather than keep the ones that Allstate has already satisfied, and that the company would never alienate its consumer base by "lowballing" them.

"It doesn't make sense to deliver anything but superior customer service," he said.

Allstate's underwriters, Lloyd's of London, also weighed in on the number of contested claims.

"Lloyd's has a long history of paying all valid claims. Underwriters carefully review claims on their individual merits and settle them in good faith," Louise Shield, a spokesperson for Lloyd's, said via a telephone interview from London.

"We cannot comment on matters in litigation. However, where claims are made outside of policy terms and conditions we will, where appropriate, contest these claims," she said.

Shield said she was unable to comment when asked about the effect the litigations have on the insurance industry and costs to consumers.

Much of the language used in the lawsuits against Allstate condemns the insurance company for "failing to explain to plaintiffs the reasons for their offer of an inadequate settlement," said one lawsuit filed by the Mostyn Law Firm, adding that Allstate and its adjusters refused to conduct a reasonable investigation and breached its contractual duty.

Mostyn Law Firm has handled the majority of the lawsuits against insurance companies, and has placed ads seeking Rita-victim clients in the Beaumont Enterprise.

"Our claims adjusters are professionals in evaluating heavy damages losses…and provide fair and accurate settlements," Mellander said. "We believe in the service we provide, and we are proud of the work we do. We wouldn't be the market leader for the past 75 years if we did otherwise."

Mellander added that when Hurricane Humberto waltzed through the Golden Triangle just weeks ago, Allstate had mobile units set up and was helping people within hours after the storm's landfall.

The two year statute of limitations for filing lawsuits against insurance companies for unpaid Rita claims is about to close.

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