Many Hurricane Ida victims with property damage often faced a revolving door of adjusters that hampered their ability to secure fast, fair payments to rebuild, consumer advocates and regulators testified during a Louisiana legislative hearing Wednesday.
“What we saw down the bayou after Hurricane Ida was a nightmare,” said Doug Quinn, executive director of the American Policyholder Association.
Quinn told lawmakers on the Joint House and Senate Insurance Committee he witnessed downed live wires, barefoot children walking in water polluted with sewage and people living “in homes where I could smell the mold from the front yard.”
“We have serious concerns about adjuster churn or what we call adjuster roulette,” Quinn said. “The No. 1 complaint is delay — slow pay or no pay.”
He said adjuster churn — multiple adjusters on a single claim — exacerbates property owners’ frustrations.
Louisiana Insurance Commissioner Jim Donelon said excessive adjuster churn is inexcusable and may require legislation to limit such churn.
“Crisis is not too strong a word for what we’re still dealing with from two of the most powerful hurricanes ever,” said Donelon, referring to Hurricane Laura in southwestern Louisiana in 2020 and Hurricane Ida on Aug. 29, 2021 in what’s known as bayou country.
Representatives of Allstate and State Farm, the two largest carriers in Louisiana, each said 82% of their customers’ claims, which totaled a combined 95,000, have been closed. A representative from Louisiana Farm Bureau said his company has closed 99% of their customers’ 9,170 claims.
“Closed claims” does not necessarily mean paid claims.
“Our commitment to our policy holders is we’re going to pay them what we owe them, but that requires diligent investigation,” said Natalie Brunson-Wheeler of State Farm.
Allstate’s Noel Young acknowledged issues with securing enough qualified adjusters to handle major disasters like Hurricane Ida.
“There aren’t enough adjusters out there,” Young said. “We try our best. I think we do a relatively good job, but catastrophes are hard.”
Quinn said homeowners who have been through a disaster “are a traumatized population who aren’t functioning at full capacity.”
That puts hurricane victims at a disadvantage when dealing with insurance companies and their adjusters.
“They are filing claims maybe once or twice in their lifetimes and are in a compromised position (dealing with) companies with unlimited resources,” Quinn said. “The claims process isn’t a level playing field.”
Greg Hilburn covers state politics for the USA TODAY Network of Louisiana. Follow him on Twitter @GregHilburn1.