The right to repair provisions are legal under Florida law. Insurance companies claim that the “right to repair” clause stops contractor abuses, while everyone else says it just enables insurance carriers to perform repairs cheaply and often results in substandard repair work.
In early 2017 Citizens got approval from the OIR (Florida’s Office Of Insurance
Regulation) to implement the Citizens’ Managed Repair Program.
If you are insured with Citizens and you have a water damage loss you can either.
• Use your own contractor and you will be capped at $10k. You will have to make that work regardless of how much water damage there actually is.
• Use Citizens managed repair program with no cap.
There are several problems with this new program.
1) Conflict of interest.
An insurance carrier’s responsibility should be to focus on assessing the claim and making a swift coverage determination. Now however they seem to be in the business of subcontracting
out the work to contractors.
2) Depriving the homeowner of choosing its own contractor
The contractors used in Citizens’ program could result in sub-par work due to the fact that those contractors are motivated to save money for insurance companies like Citizens as opposed to bringing the insured back to pre loss conditions.
Citizens say the reason why they are doing this is to lower costs so they can bring down the homeowners premium. We have yet to see any lowering of the homeowners premium at all, in fact it has increased tremendously over the last year.
The other insurance carrier we have seen to enforce this clause is Peoples Trust. In fact Peoples
Trust have taken it to another level and filed dozens of lawsuits against its own
customers who they believe have failed to comply with the policy by not allowing People’s Trust’s
preferred vendors to repair damages to the insured’s home.