By Raymond A. Altieri, Jr., CPPA / Published August 2023
This past year the Florida legislature, through severe pressure placed on it by the insurance lobby, passed legislation whereby a policyholder has only 18 months from the date the hurricane strikes to fully submit their claim of damage, whether those damages are known on day one or found much later during the reconstruction process. This is a major reduction in filing time.
To the lay person, a year and a half may seem like ample time to get that done. However, when an association board of directors and/or a property manager decides professional claims representation can wait because they are relying upon its insurer or a contractor to write damage estimates, they are gambling against themselves that the insurer will supply a satisfying comprehensive damage assessment timely enough to make payment for that association to recover. Unfortunately, they may be playing Russian roulette.
Eighteen months is your damage filing deadline for a claim and sometimes only 60 days for your flood claim. Without personalized professional claim assistance working for the association, these timeframes can make the claim experience more devastating than the hurricane itself.
The new 18-month supplemental or reopened claim deadline is not a policyholder-friendly statute revision. This deadline, promoted by insurers for their own good, is in place to reduce a policyholder’s ability to make a claim or to make an additional claim for damages that were unknown to them until a later date.
The 18-month filing deadline was passed by the legislature even though it is common knowledge within the property claims industry that it sometimes takes many months, even years, to discover the subtle damage a hurricane can cause. For instance, it is easy to see the blown-out glazing of a sliding glass door or a peeled back roof membrane. Certain other types of damage take longer to manifest or require extraordinary efforts to uncover.
Here is one example. Even though an association would have paid its premiums for this type of protective coverage, without the trained eye taking the necessary time to closely inspect one door and window at a time in order to identify the potential subtle failures of hundreds or thousands of frames, seals, and gaskets of sliding glass doors or windows of multi-story buildings or of multi-building complexes, these damages would go unclaimed by unsuspecting, unrepresented policyholders, to the favor of insurance companies.
With today’s building code, designs having been strengthened; it is expected that less catastrophic failure of building components will be seen, saving lives and property, but that does not mean those designs do not have limits. Therefore, subtle failures can happen and need to be recognized as damage in need of replacement, or repair if possible, by insurers. Most importantly, they should never be ignored. To ignore subtle failures only sets up the affected building components for catastrophic failure in the future, obviously undermining all that the strengthened building codes were designed to do.
So, with the shortened timeframe now in place to recognize all hurricane-related damage, it is incumbent upon condominium associations to begin their detailed, diligent analysis of loss earlier in the life of their claim rather than later.
Considering the above, it is now more important than ever for condominium associations to become proactive in a multitude of ways.
You will never regret the pre-loss planning because once damage has occurred, your plan and team members are already in place starting your recovery. After a major hurricane hits, there will be enough chaos to go around, and your immediate recovery response should not be part of that.
As a director or a property manager, you accept serious responsibilities on behalf of all unit owners. In previous years, some associations felt comfortable with the “let’s wait and see what our insurance company does” approach. In Florida in 2023, boards of directors and property managers should no longer see that luxury as an option.
Insurance company adjusters are frequently responsible for handling hundreds of claims at a time. It is extremely difficult for them to spend the time necessary on your claim compared to that of a dedicated advocate with aligned interests. The dedicated advocate is your professional public adjuster, who will spend the time to inspect your buildings and to understand to what extent the hurricane winds, rains, and flood waters damaged your property. They will even segregate damage to the proper insurance policy, making sure each insurer recognizes all damages they must pay.
With these newly imposed deadlines built into the claims process, boards of directors no longer have the time to wait for others who do not have aligned interests to hopefully do right by them without exposing themselves to their own potential negligence or liability for not using professional adjusters to manage the claim process for them from the beginning. In all industries the use of professional experts has been a time-tested business practice found to be worth its weight in gold, and this circumstance is no different.
In these times, a Florida property owner cannot think that planning is only needed for the physical recovery from severe damage. A policyholder must recognize how vital it is to understand how to navigate the complexities of insurance policies, claims adjusting regulations, and construction methods and to maintain a semblance of leverage with its insurer.
Insurance premiums are skyrocketing as coverage within these policies dwindles. Hurricane deductibles can be in the hundreds of thousands or even millions of dollars today, and an association must accept that it now requires specialized claim expertise on their side to overcome the hurdles to full recovery. Your goal is naturally to attain the highest level of claim settlement success; but now, in 2023 and moving forward, you will be required to achieve it in record time.
If you have watched Florida communities scurry in chaos and uncertainty after taking a major hit from dangerous hurricanes, you will understand why it is so important to create a plan of action NOW before the hurricane comes to your region. As they say, “Failing to prepare is preparing to fail.” Be prepared for the next hurricane by conducting a pre-loss policy review and claim team selection. Be ready to move forward immediately after the storm strikes, eliminating the potential for the new legislative deadline to impact your ability to recover physically, emotionally, and financially.
Raymond A. Altieri, Jr., CPPA, Founder And Chairman
Altieri Insurance Consultants
Raymond A. Altieri, Jr., CPPA, is founder and chairman of Altieri Insurance Consultants. For more information, call 800-934-1114 or visit www.altieriinsuranceconsultants.com.