Marcia Hernandez lived in her four-bedroom home in southwest Miami-Dade for more than 20 years. She raised her two, now grown, children there.
Then, on one sunny Saturday morning last September, the house that was the foundation for their lives and had produced so many memories was gone -- nothing more than a pile of wood, crushed cinder blocks and mangled metal -- when a neighboring home exploded.
Fourteen months later, it is the center of a controversy pitting citizens against Citizens Property Insurance Company.
"Citizens, by virtue of being a quasi governmental entity, can virtually handle your claim any which way they deem fit and know they will not, and cannot, be sued for bad faith," said attorney Danny Espinosa.
Recently, his firm, Espinosa | Jomarron, which specializes in property insurance claims, was hired by 10 homeowners. They got to talking one day and realized they all had something in common: they each held policies with Citizens Property Insurance Corporation.
What really infuriates them is that the woman who owned the home that exploded was also insured by Citizens, except she was paid in full, while they were denied, despite living within feet of her house.
"You've got to hurt them where it hurts," said Espinosa, "and that is, their pocket, their bottom line."
The home, which stood at 6355 Southwest 151st Place, was condemned by the county and demolished days later on Sept. 22, 2012.
Dozens of houses around the neighborhood were severely damaged. Roofs were lifted and dropped, windows blown out, ceilings and floors cracked leaving marks from one end of a home to another.
In some houses, when it rains, it pours inside. These are just some of the problems.
"It's frustrating," Jorge Gomez told Local 10 Investigator John Turchin, "because every year you pay your insurance. If you miss one payment, they cancel you. But yet you ask them to come in and do an inspection to repair your home, which you have insured through them, and they deny everything."
Ricardo Vasquez, who lives up the block, agrees.
"It's not our fault," said Vasquez.
Orlando Martinez feels the same way. He lives right behind the house that exploded.
"You at least should get some kind of a payment, some kind of an adjustment, for the initial stuff," Martinez said.
Citizens has denied their claims, claiming among other things the damage was there before the explosion; that it was caused by wear and tear and/or deterioration -- though they admit its engineers hadn't previously inspected any of the homes; that it was caused directly or indirectly by earth movement and settling -- cracking or expansion of foundations; or, caused by faulty, inadequate or defective planning, zoning, development and surveying.
"If Citizens would just go valuate the claims, pay the claims what they're worth and move on," explained Espinosa. "We'd all save money and we'd all pay less premiums. Our insurance rates would not continue to climb."
A Local 10 investigation has discovered that Citizens has earned a reputation for systematically denying almost every insurance claim brought forth by its policyholders.
To some of its critics, they're "rubber-stamping" responses. Instead of honoring, what many insist are "valid" claims, its critics say Citizens spends millions of dollars every month in legal fees "defending" claims -- the same type of claims that other insurance companies would routinely pay without question.
Local 10 contacted Citizens. Here is some of what they had to say:
- Q: Is a sudden, accidental explosion covered under these insurance policies?
A: Yes, if the explosion is determined to be the cause of the damage.
- Q: Is it your (Citizens) contention that the explosion that caused damages to the neighboring homes are not covered by the policies that Citizens issued to the insured?
A: Though fact specific, damage caused by an accidental explosion is generally covered. In broad terms, the issue surrounding these claims appears to be whether the explosion caused the damage.
- Q: These people (nine homeowners) believe their claims are covered under their policy. Are they? And if so, what is the true basis for the denials?
A: The cases are in litigation so we can presume we disagree.
- Q: Did Citizens inspect any of these homes (referring to the nine homes of which we have provided them information) before issuing the insurance policy for the effective policy period at issue?
A: Under current policy, inspections are required for any home over 30 years old or in sinkhole territories. The 4-point inspection looks at heating, ventilation and air conditioning, electrical wiring, plumbing connections and fixtures and the condition of the roof. These homes appear to be newer so may not have been required to have inspection.
- Q: How do you know these damages were created prior to the explosion, as several of the denials contend?
A: Case specific, so can’t comment on these particular claims.
- Q: Why did it take so long (in some instances, 7 months) to have an engineer inspect the properties?
A: Can't comment.
- Q: What is your response from the lawyers that Citizens takes advantage of the fact that you are immune from bad faith action under Florida Statute 624.155?
A: We try to balance the responsibility we have to our policyholders to pay valid claims with our responsibility to be good stewards for all Florida policyholders, who must ante up if we cannot pay our claims.