To help consumers and small businesses receive equitable payments on insurance claims, Rep. La Shawn K. Ford is sponsoring legislation to help policyholders get fairly reimbursed for experts and consultants who help them make their case.
“The passage of House Bill 142 would be a huge win for Illinois insurance policyholders,” said Rep. Ford, D-Chicago. “The legislation would ensure thousands of dollars in additional funds and fair and balanced payments for people with claims for damages to their homes and businesses. If this bill is passed, insurance carriers would be responsible for all reasonable fees associated with correcting mistakes that led to a denied or underpaid property damage claim.”
Last year, Bishop Bill Ellis – Chicago South Side resident and pastor of the Apostolic Pentecostal Church of Morgan Park — sought help from local public adjusters for a damaged roof claim for the church. Initially, the insurance company quoted a claim amount so low the church would not be able to complete the repairs. Apostolic Pentecostal Church serves a vital role in providing neighborhood resources, so the community suffered while the church tried to resolve the claim.
“If we have this new law – House Bill 142 — it will make it better for all Illinois citizens, and especially small business owners, churches, and non-profits,” Ellis said. “This new legislation would help policyholders when they are forced to go into their own pocket to investigate and establish the true extent of their damages.”
Pastor Kelvin Easter of Destined to Win Christian Center church in South Holland was facing an unfair payment from his insurance company on a weather-related roof claim until he hired a public adjuster to help represent him.
“I wish we had this law when my claim happened and I thank Rep. La Shawn K. Ford for fighting for average homeowners and small business people,” Easter said.
When a property damage claim is wrongfully denied or underpaid, policyholders must either accept the underpayment or, as a direct consequence of the underpayment, payout of their own pocket for third-party experts to correct mistakes made by the insurance carrier, Ford said.
“If this bill passes, policyholders would be able to seek reimbursement of the reasonable costs associated with getting a claim fairly paid, particularly in circumstances when the claim is wrongfully denied,” Ford said.
“The cost to hire experts can add up quickly and may be out of reach for some policyholders leaving them to choose between an underpaid claim or a fairly paid claim that is significantly reduced due to the costs of hiring experts,” Ford said. “The ‘law of diminishing returns’ becomes a reality for most consumers, especially if the claim size and economics do not support the ability to absorb some of these very real costs. This situation has created a market failure for consumers not just in Illinois, but in many states around the country.”
The legislation is an initiative of the American Adjuster Association and is also supported by the Chicagoland Public Adjusters Association.
“Cost balancing is a common-sense approach that protects consumers and levels the playing field against big insurance carriers,” said Scott Green of the American Adjuster Association of Illinois. “We all recognize we need a strong and functioning insurance industry in Illinois, and the aim of this bill is not to punish insurance companies. This is a consumer-oriented bill that is narrowly focused on ensuring policyholders obtain the full value of their claims. If this type of remedy exists for consumers, it will encourage fair resolution of claims and the avoidance of unnecessary litigation.”
