PIA of Fla. Answers Hurricane Planning Questions

Forty key catastrophic planning questions and answers were presented by Ron Silverman, a Professional Insurance Agents of Florida instructor and owner of Silverman Insurance Agency in Deltona Beach, Fla., during educational sessions titled “Lessons Learned from Charley, Frances, Jeanne and Ivan.”

Silverman’s St. Petersburg presentations took place as Hurricane Rita was approaching the Florida Keys.

Silverman’s goal was to answer 40 questions, including: “When is a hurricane considered a hurricane for your client under Florida statutes? What is wind-driven rain? and What are the ramifications of the Mierzwa decision?”

“If a hurricane watch is announced for any part of Florida, the entire state goes under hurricane deductibles and that condition stays in effect until 72 hours after the hurricane watch stops,” Silverman explained to answer the first question.

Mierzwa case straightforward
Silverman described the Mierzwa decision as a straightforward case with complex legal issues. He said the case hinges around whether a total loss is caused by flooding or hurricane and if so, how much each policy should pay.

The plot thickens when local ordinances require a building, if more than 50 percent damaged, to be condemned and brought up to standards. Silverman said that in such cases the building often has to be totally demolished and the property landscaped to meet building code requirements. A new law mandates the offering of 50 percent law and ordinance coverages as of Oct. 1.

Condo policy loopholes
Silverman described loopholes in condominium policies. He outlined when association policies would cover a condominium, and wouldn’t. He said that the contents of condos are never covered by the association policies, and that owners are often underinsured. He cited luxurious condos in which the owner had put in special counter tops, cabinets and bathroom appliances.

“A majority of the condominium lawsuits you see are about lack of coverage,” Silverman explained. “Owners often sue the condominium board for misconstrued breach of duty.”

He explained condo owners often don’t realize what their insurance covers.

Silverman said another problem occurs when the condo owner wants a mortgage. “Condominium owners have a divisible interest in their building, covered under the master contract on that basis,” Silverman said. “But, they have no right to encumber that property in the master policy to their private unit.”

Silverman pointed out a common condominium claim occurs when a pipe breaks. The three most common types of claims are pipe leaks, sinkholes and hurricanes.

“When selling homeowners policies be careful to indicate what is and isn’t covered,” Silverman concluded. “Flood coverage does not cover anything like fences, retaining walls or docks.”