Payout points way home

Jul 21, 2008

St. Petersburg Times–July 18, 2008

By Tom Zucco, Times Staff Writer

ARCADIA — For nearly four years, Bobby Young has lived with either his mother or his girlfriend. The one place he hasn’t lived is 809 S Orange Ave. — his home.

A lawsuit against his insurance company is about to change that.

When Hurricane Charley ripped through the town on Friday, Aug. 13, 2004, it peeled part of the roof off Young’s wood frame home. Water poured through the ceiling, damaging most of his possessions. His insurance company sent him a check for about $10,000.

But there was a problem. Young, 60, couldn’t find anyone to replace the roof for less than $11,000. And not only were extensive repairs needed to the inside of the house, he also had to replace most of his furniture, appliances and clothing. So as the mold settled in, he gathered up what he could and moved out.

"I keep the yard up to let people know the house isn’t abandoned," Young said.

Now he and many other lower-income people in this largely forgotten stopover along State Road 70 can go home again.

Last week, Young was one of 48 United Casualty Insurance Co. of America policyholders who split an award of $944,056 granted after they filed suit against St. Louis’ United Casualty in the fall alleging that claims were underpaid. (The company is not affiliated with United Property and Casualty, one of the top 20 writers of homeowners insurance in Florida.)

The awards range from $6,000 to more than $34,000. For his part, Young was awarded an additional $21,955.

David Pettinato, a lawyer with the Merlin Law Group, a Tampa firm that specializes in insurance litigation, represents the Arcadia policyholders. He said now that contractual damages are resolved, he will return to DeSoto County Court to focus on the bad faith portion of the lawsuit.

Most of the Arcadia policyholders don’t have mortgages and had bought so-called debit policies from United — policies that are often sold door to door and paid for in monthly premiums. Most conventional homeowners insurance coverage is purchased on an annual or semiannual basis.

"From our investigation, we see evidence that United has targeted low-income families with this type of policy," Pettinato said. "This (award) allows these people to put their lives back together and gives them hope."

John R. Camillo, general counsel for United Casualty, said that while his company believes the claims were handled properly, "We opted to use the appraisal process provided for in the policies in order to amicably and quickly resolve the disputes.

"Though we feel that the amounts awarded in many of the appraisals are improper and inflated," Camillo added, "this is a process we agreed to and, accordingly, the company has paid the awards in order to bring this matter to a final conclusion."

State regulators say United Casualty had 22,600 Florida policies on its books in 2007, but has none today. It remains licensed to sell policies in Florida.

A supervisor at a citrus-processing plant, Young said United canceled his policy. But at least he can return home. "With all this rainy weather, you hope you can get the repairs done before a hurricane comes," he said.

"I’ve just been scrapping by on a wing and a prayer, trying to do the right thing."