On-Time Payment Inexplicably Posts Late, Canceling Insurance

(www.tbo.com) - What could be worse than bracing for an approaching hurricane? Approaching hurricane season without homeowners insurance.

Courtney Hoening fretted through the Memorial Day weekend after receiving a notice that coverage on the Tampa home she shares with her husband had lapsed. This was especially shocking since she paid her premium five days before it was due.

"You almost don't want to leave the house because you're afraid something will happen, and you don't know for sure if you're covered even though you have the receipt, and you're praying that's all you would need. But you don't know that for sure," Hoening said.

Here's the timeline: Hoening has a receipt showing she paid her premium on her Citizens Property Insurance policy on May 17. Her insurance agent said it was sent to Citizens that day. It was due on May 22. The Hoenings received the notice of lapse on May 26.

Policy Eventually Reinstated

On June 5, the Hoenings' policy was reinstated, and they received a notice to that effect.

She was relieved, especially because it was already four days into hurricane season when the last notice showed up. Hoening was also frustrated.

"Essentially to us, it seems like the check sat on someone's desk for two weeks. We pay our bills on time. We shouldn't receive notices like this in the mail. This is ridiculous," Hoening said.

Citizens spokesman Rocky Scott said its tracking system showed the company received the check on May 28 (11 days after Hoening said she paid) and cleared two days later. The two-day turnaround for processing is routine, said Scott, who insisted the delay was not the insurance company's fault.

With regards to the 11-day gap between the time Hoening's insurance agent said she sent the payment until the company said it received the check, "I have no explanation for that," Scott said.

Citizens bills are mailed out 60 days in advance, according to Scott. He recommends consumers pay their bills sooner than later to avoid panic, gaps and mail mysteries, as the Hoenings' situation appears to be.

Options Available

To ease the financial burden of hefty policy premiums, Citizens customers can opt to pay their premiums in annual, biannual or quarterly installments.

Scott said that change took effect on Aug. 1 and is a result of the special legislative session on insurance in January.

Customers with questions about premium payments or other aspects of their policies should talk to their agents.

As of Aug. 14, 131,262 policies have been taken out of Citizens' hands by other insurance companies. If you are a Citizens customer and are offered an alternative, you can check on the company's license and complaint history by calling the Department of Financial Services at 1-800-342-2762.

A license means the company has passed inspection by the department's Office of Insurance Regulation and meets the financial criteria set by the state. It also means the company is a member of the Florida Insurance Guaranty Association, which handles claims for consumers of insurance companies that go out of business.

Hoening is stuck with Citizens; it's the only company that will insure her home. Even though the payment problem has been resolved, she is still worried about her coverage.

"I'm scared to death to file a claim with [Citizens]," she said. "I hope it's processed more efficiently than" her premium.