By Michael Loney
April 2 - (The Insurer) - Florida’s attorney general has reached an agreement with Universal Property & Casualty Insurance Company that resolves allegations the carrier fraudulently submitted numerous ineligible claims for reimbursement in violation of the Florida False Claims Act.
Attorney General James Uthmeier said he had secured the return of more than $30 million to the Florida Hurricane Catastrophe Fund from fraudulent insurance submission allegations following Hurricane Irma.
He said this is the first time his office has secured repayment related to an insurance fraud case.
UPCIC parent Universal Insurance Holdings issued a statement saying that it “refuted all allegations of fraudulent submission, and the matter has been formally dismissed by the state”.
The attorney general’s office launched an investigation into UPCIC following a whistleblower lawsuit filed in Leon County to ensure that the claims submitted by the company were caused by Hurricane Irma.
“During the course of that investigation, numerous unrelated claims were identified in the submissions from UPCIC to the FHCF. As a result, the company agreed not to seek reimbursement for those claims, lowering the FHCF payout from Hurricane Irma to UPCIC by more than $30 million.”
Uthmeier's office said the company has also agreed to pay more than $4 million in fines and implement changes to its policies and procedures.
The settlement agreement shows that UPCIC has agreed to pay a total of $6.5 million including a payment of $2.4 million to a legal affairs revolving trust fund of the state’s reasonable expenses, attorneys’ fees and costs.
Universal in its statement said that the review arose when a former employee in its claims operation who left in mid-2018 and who had no involvement in or familiarity with the data analytics team or FHCF reporting procedures alleged it improperly included certain non-Irma claims in preliminary reports submitted to the fund.
“The assertions contain numerous fundamental factual inaccuracies and gross mischaracterisations,” Universal said.
The company added that its estimated Hurricane Irma losses during the former employee’s tenure remained well below the fund threshold.
“The company recognised throughout the review that the underlying assertions lacked merit and were frivolous,” it added.
Hurricane Irma was the single largest loss event in Universal’s history. The insurer said that Florida’s pre-reform laws and resulting abuses that generated an excessive litigation environment drove the storm’s costs from an initial estimate of $450 million to $2 billion.
“We are pleased the review has come to a close and the state dismissed the case,” said the carrier's CEO Stephen Donaghy. “We look forward to continuing to serve Floridians as market reforms are leading to more affordable home insurance options for consumers.”
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