New Orleans, LA: Louisiana Citizens Property Insurance Corp. reached a $23 million settlement with thousands of homeowners who claimed they were insufficiently compensated for work needed to coordinate storm repairs after hurricanes Katrina and Rita.
In settling the class-action lawsuit, Louisiana Citizens, the state's property insurer of last resort, admitted no wrongdoing.
The case involved homeowners who needed three or more contractors to make repairs. The homeowners alleged Louisiana Citizens failed to pay so-called general contractor overhead and profit to a number of its policyholders. Typically, when three or more contractors, say for example, an electrician, plumber and roofer, are needed to make repairs, insurers are supposed to pay extra money to cover the cost of a general contractor to coordinate their work, typically 20% of the repair bill.
The case, Stephanie Press v. Louisiana Citizens Fair Plan Property Insurance Corp., was certified as a class action in August 2008. There are no firm numbers on the size of the class, but Wortman said Louisiana Citizens estimates the settlement affects between 7,000 and 10,000 claimants.
The settlement must be approved by a judge in state district court in New Orleans. A hearing is planned for November 18.
