Homeowners decked by Katrina still wait for insurers to pay up

USA Today
Monday, September 25, 2006

PASCAGOULA, Miss. — A year after Hurricane Katrina flattened her ranch-style brick house on Washington Avenue here, Tina Lee has received only $2,500 from her homeowner's policy for living expenses.

The insurance disputes are "the second catastrophe to hit Louisiana," says Madro Bandaries, an attorney representing homeowners in a class-action lawsuit against Louisiana's insurer of last resort, which provides high-cost policies for those who can't get policies elsewhere. A year after the storm, "We have thousands of people who have yet to receive adequate money or have yet to receive any money at all."
Insurance companies have paid out nearly $15.5 billion for Katrina's damage to homes, but billions more dollars are at stake in these lawsuits.
Robert Hartwig, chief economist of the Insurance Information Institute (III), a research group funded by insurers, says that "whatever shortcomings these trial lawyers claim are gross misrepresentations of the truth. We have settled hundreds of thousands of claims expeditiously and fairly."
Some homeowners who haven't gotten insurance payments will receive federal aid, tap retirement funds or take out loans to rebuild. Many others will remain in FEMA trailers or live with friends until insurance money arrives, because, "There's just no money in a lockbox for these folks," says Patrick Buckley of the Center for Justice & Democracy, a consumer-advocacy group.

For a copy of the complete article, contact CJ&D.

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