Louisiana Citizens Asks U.S. High Court to Hear Claims Suit Appeal

Article

Louisiana’s property insurer of last resort has asked the nation’s highest court to hear an appeal of a $104.6 million award to 18,500 policyholders who sued over slow adjustment of hurricane claims in 2005.

The action by Louisiana Citizens Property Insurance Corp. came as an order was issued to the East Baton Rouge Parish sheriff to get the money from the insurer’s bank.

In a statement, plaintiff attorney Fred Herman said a state district judge in Jefferson Parish would decide how to divide the money once it is turned over by Regions Bank.

Citizens’ chief executive, Richard Robertson, said a request for the U.S. Supreme Court to hear the case was filed on April 18. There was no indication of when the court might decide to accept or reject the request.

“We are exploring what options we have as to the garnishment being filed,” Robertson told The Associated Press.

Citizens’ policyholders won $92.8 million in a class-action lawsuit alleging that Citizens did not start to adjust claims for hurricanes Katrina and Rita within the 30 days required by state law. Since the original decision, the bill has grown to just under $105 million with judicial interest.

Another group of 6,500 policyholders has pending claims estimated to be worth up to $35 million. Attempts to settle the case to cover all policyholders with claims have failed. Herman said the plaintiffs are willing to negotiate the pending claims, but “our main focus now is to get our clients paid.”

The Louisiana Supreme Court has ruled that Citizens has lost all of its possible state appeals and the plaintiffs can move to collect their money. Citizens has claimed that a $6 million payment it posted to appeal the case covered all appeals, including one to the U.S. Supreme Court. But state courts have rejected that contention.