The state fined Heritage Property & Casualty Insurance Co. $1 million May 9 for mishandling Hurricane Ian claims and violating state insurance laws. 

The Tampa-based insurer, which faced suspension or revocation in Florida for nine violations, agreed to be fined and to pay $10,000 in administrative costs for violations that include failing to acknowledge receiving claims within 14 calendar days and not paying or denying claims within 90 days, according to a consent order signed by Florida Insurance Commissioner Michael Yaworsky.  

The agreement followed an examination and March report by the state Office of Insurance Regulation. 

Heritage CEO Ernie Garateix said the company already identified some problems and “fully complied” before OIR’s market-conduct examination into Hurricane Ian claims from September 28, 2022, to February 2023. 

“We also informed OIR that many of the same concerns they identified were also flagged internally and we have already taken significant action to address those concerns in order to better serve our policyholders,” Garateix said. 

Florida claims totaled $21,386,266,489 from all insurers. Heritage assumed nearly 340,000 policies from Citizens Property Insurance Corp. from 2012-16, more than other insurers, but after Hurricane Irma, it began dropping policies. A U.S. Securities & Exchange Commission filing last week showed parent company Heritage Insurance Holdings Inc. had 147,954 Florida policies during the first quarter of 2024, down 14% from 172,425 a year earlier. The SEC filing showed $716.86 million in Florida premiums and $670.19 million in other states. 

The March report also said Heritage: 

• Failed to use properly appointed insurance adjusters. 
• Didn’t maintain complete claims records. 
• Failed to provide policyholders with documents showing the adjuster’s name and license. 
• Didn’t include the adjuster’s name and license number when communicating about claims. 
• Didn’t calculate the correct interest amount owed on claim payments. 
• Didn’t pay interest when a payment was made 90 days after receiving notice of a claim. 
• Failed to provide policyholders with a Homeowner Claims Bill of Rights within 14 days. 
• Didn’t use properly appointed adjusters or used emergency adjusters before the Florida Department of Financial Services issued appropriate licenses. 
• Didn’t maintain claims experience records. 

Garateix said key service improvements Heritage already made include: 

• Creating a Governance and Compliance Director position to further ensure compliance.  
• Expanding the claims quality-assurance process. 
• Adding internal-audit function resources. 
• Implementing new claims-management software. 
• Requiring field adjusters to document how they provide policyholders with a printed or electronic document. 
• Modifying software to require an adjuster’s license number. 
• Creating automated reports to track compliance claim timeframes. 
• Reformulating its claims-interest calculator. 
• Requiring that new third-party desk adjusters’ names and licenses are verified. 
• Implementing a new claims training program. 
• Expanding the Claims Quality Assurance function to 10 employees. 

“Our message to our policyholders is simple: We are committed to excellence and will never stop striving to improve,” Garateix said. “Heritage wants to be a valued partner for our policyholders in their time of need and the state of Florida.”