You Thought You Were Covered with David Murray

January 9, 2024

117.  You Thought You Were Covered with David Murray

In this episode, attorney David Murray spills the beans on the wild world of home insurance claims. Murray doesn't just scratch the surface; he dives deep into the emotional rollercoaster homeowners face post-disaster. Murray articulates the profit-centric motives shaping insurance policies, underscoring the importance of understanding your policy well before crises unfold. From sketchy lowball offers to never-ending claims, it's a rigged game against homeowners. The episode shouts, "Wake up, homeowners!"

Here’s how you can follow David:

LinkedIn: https://www.linkedin.com/in/david-murray-esquire-77513661/  

Website:  www.MurrayLawGroup.com   

Important information from Homeowners Be Aware:

Here are ways you can follow me on-line:

Instagram: https://www.instagram.com/homeownersbeaware/

Website: https://homeownersbeaware.com/

LinkedIn: https://www.linkedin.com/in/george-siegal/

If you'd like to reach me for any reason, here's the link to my contact form:

https://homeownersbeaware.com/contact

Here's the link to the trailer for the documentary film I'm making: Built to Last: Buyer Beware.

🎧 If you enjoyed this episode, don't keep it to yourself! Share it with your friends and help spread the knowledge. Remember to hit the like button, subscribe for more insightful content, and leave a review to let us know your thoughts. Your support means the world to us! 🌟

Thanks for listening!

Chapters

• 0:00 Homeowners Insurance
• 12:49 Challenges & Frustrations With Insurance Companies
• 27:20 Challenges and Accountability in Insurance Industry
• 38:55 Insurance Premiums and Industry Changes
• 43:09 Concerns and Issues With Insurance Companies

Transcript

George Siegal: 0:00

Thank you for joining me on this week's Homeowners Be Aware podcast. How confident are you that, if a disaster struck your home, your homeowner's insurance would be there to help you pick up the pieces? If your answer is yes, what are you basing that on? Have you actually read your policy or had it explained to you? Every time there's a disaster, we hear tragic stories of people that thought they had coverage for what happened and they didn't. Even worse, the insurance company made it difficult, if not impossible, to get the claim paid. That's when my guest today gets involved. David Murray is an attorney here in Tampa who helps his clients hold the insurance company to their end of the contract. In today's podcast, you are going to learn what you need to do to give yourself the best chance of being able to pick up the pieces after a disaster. I'm George Siegal, and this is Homeowners Be Aware the podcast that teaches you everything you need to know about being a homeowner. David, thank you so much for joining me today.

David Murray: 1:00

Thank you for having me, George.

George Siegal: 1:02

Hey, when we interviewed you for Built to Last Buyer, be Aware you had so many interesting things to say. I watched the video that you guys made with the victims of insurance companies not taking care of them and doing their part. My main question, or my leading question to you is how does this happen? Why does this happen?

David Murray: 1:24

As far as insurance not being taken care of by their insurance companies.

George Siegal: 1:27

Those poor people whose lives are ruined and the battle they have to go through to try to get their life back. It just seems that nobody other than maybe their attorney cares.

David Murray: 1:40

I think there are some people that care, but I think there's not enough people that care. Until you've really gone through a traumatic claim experience, I don't think you can truly appreciate what people are experiencing. There's a saying your home is your castle. At the end of the day, you go home from work and you feel comfortable in your home. That's the one place that you can relax and be yourself. When you have a big claim event whether it's a fire or water or a hurricane, and that safety zone is taken away from you, you really struggle.

David Murray: 2:20

I think the professionals that work in the claims environment see the situation as just another claim. They don't see it as it truly affects people on a daily basis emotionally, physically, mentally. What happens is, especially in Florida, we have adopted this us versus them mentality of the insured versus the insurance company. I think if you ask anyone, they think that there's supposed to be a relationship where you have to battle your insurance company to get what you're entitled to. That's what we have programmed to believe. We've been programmed to believe really question whether you want to file a claim because you may lose this insurance product.

David Murray: 3:05

I think what happens is is that the industry is programmed to think that people are out there committing fraud and asking for money that they don't think they're entitled to. Then the policy order thinks the insurance company is just trying to hold on to the money longer, to make money, which they do Every day, that that money sits inside an insurance company. That insurance company is making money on interest or investments. To get that money it's very, very difficult. I think it's just become the norm, other than the exception. It's become the norm.

David Murray: 3:43

That's part of the largest problem. I think that people think you're just supposed to have to battle for everything. Think of it this way when you go to a fast food restaurant, you don't have to battle for your burger. When you go to buy a product from Target, you don't have to battle to buy it. When you go to get a haircut, like I did last night, you might have to sit in line a few minutes, but eventually they'll get to you and you'll get your haircut. With insurance, you're told you need to wait until we do what we think we need to do.

George Siegal: 4:16

It's such a different situation when you say you don't have to battle for those other things, you also have a choice of. Then, if the line's too long in Target, I go someplace else and I can get what I want. With insurance we don't have that ability. You're lucky to have insurance, especially if you live in Florida, that the thought of switching policies isn't something you can do like grabbing a different burger or going to a different store.

David Murray: 4:38

There's not as much choice in the marketplace right now because it is a product that people have to buy. If you have a mortgage, it's a product people want to buy. If you want security from natural disasters or events such as fires or water losses, you can go pick any other product or any other service. I would say easier than property insurance in your life now. You can go buy any type of car you want within reason of your financial means. You can go get even doctors visits. You have the ability to choose a doctor easier than you do choosing an insurance policy to cover your home or your business.

George Siegal: 5:29

To me it's mind-boggling why that is so difficult For people that are buying insurance. I think so many of them don't truly understand that you think you have something that's going to take care of you, but you might have to fight to get it to actually take care of you. How do we educate people to make this transaction better?

David Murray: 5:53

The way the transaction comes better to people is when they realize what they're buying. Most people don't ever realize what type of insurance that they purchased or the ins and outs of the insurance policy until they have a claim. Then it's too late. You can't go back and change the policy then. A good example is mold limits. It's pretty much limited to $10,000 worth of mold coverage.

David Murray: 6:20

Now A lot of insurance companies have $10,000 water limits. If you have a water loss event where water comes down from the second story of your home to your first floor and you don't look at that policy, you don't know. You only have $10,000 worth of water limit coverage, people tell you, but you really don't know what you are buying until you try to use it. Part of the problem is that I believe agents need to be held to a higher standard of informing people what they're buying. As part of that process they have you sign all these endorsements and sign off on all of these acknowledgments that you have a percentage hurricane deductible, that you are rejecting ordinance and law coverage, that you're not purchasing sinkhole coverage, that your water limit coverage is only $10,000. People get immune to all of the small print when they're signing up for an insurance policy. Because they're asked to sign away so many rights, they don't take the time to read it. The bigger problem is that people are not educating them on what they are really signing away.

George Siegal: 7:42

Let's assume I'm educated. Let's live in fantasy land here and say I'm actually educated. I know exactly what I'm signing. That's still not going to help me. When the hurricane hits, these guys start jerking me around and won't pay my claim. I may understand it, but that doesn't make fixing it any better.

David Murray: 8:00

There have been significant changes in Florida law that have taken away consumer protections. Our elected officials have said to the consumer as the state, we are going to regulate the insurance industry. Yet they failed to properly regulate the insurance industry. You have ongoing investigations for more than a year of insurance adjusters for the insurance industry changing estimates internally, keeping these adjusters' names on these estimates. The Office of Insurance Regulation and Jimmy Petronis' office, the Chief Financial Officer of the State of Florida, has had an ongoing investigation for more than a year. There's been nothing. Shared Insurance companies are operating, I believe, in an industry that is not properly regulated for the consumer. There's no real teeth in consumer protection. What does a big company do when it makes a mistake? It pays a fine and it moves on about its business. It doesn't apologize. No one goes to jail. No one has their licenses suspended. Out of every insurance company that has gone bankrupt in the state of Florida, what ramifications have there been for any of the people that ran those insurance companies?

George Siegal: 9:28

None. Yeah, it's kind of a helpless feeling for being on the other end of that, knowing what you might have to depend on. Now, what I love about lawyers I watch a lot of legal shows where one side makes its case and you absolutely believe it, and then the other side makes its case and you go, oh okay, that makes sense. In this instance I don't see the other side and I've really tried. I see a person whose house is wiped out and they want their money. What's the argument for not paying them?

David Murray: 10:00

The goal is to pay as little as possible or to get the insured to go away and most people a lot of people, I would say give up. They get tired. What happens is is that if you have to hire people to assist you in forcing the insurance company to pay you, then those people are being paid out of your insurance proceeds and the insurance company knows it. So what some insurance companies do is they make you fight them every step of the way and then they'll give you half maybe of what you're entitled to and you might try to find a way to make it work, and then you will hire handymen to do repairs rather than licensed general contractors to do repairs the right way.

David Murray: 10:45

A good example is you know people get a check from the insurance company and they try to make that money work to do the repairs. They're not putting it back in a pre-loss condition most times. They're just trying to get their lives back. They're just trying to get their home back, where they can move back in their home and regain their mental health and their stability and their comfort zone. It happens all too often. And what happens to an insurance company if it doesn't pay people the right amount of money they're entitled to. They're not fined by the state of Florida. Their licenses aren't suspended, revoked, denied or investigated. They just move on to the next claim.

George Siegal: 11:33

That's pretty unbelievable. Now I encourage everybody to watch that video that you shared with us. How are those people all doing? Have any of them gotten their lives back together? That are in that film.

David Murray: 11:43

So some people did. Some people they started rebuilding their lives. Some people chose to move on. Some people didn't want to start all over again. A good example is with the recent hurricanes E and the came through.

David Murray: 11:57

You had a lot of people on Santa Bell. I mean they were in their golden years, that time where it's retirement we're supposed to kick back and enjoy life. And anytime I talk with a client that has gone through that and lost their home, I ask them a serious question of do you want to spend the next couple of years fighting your insurance company to get the money you're entitled to, to then rebuild your house a couple more years after that? Because you're going to spend, after a natural disaster, the next anywhere from two to five years trying to rebuild your life. And I've had some clients that understand that and they've moved on. They go buy a new house and live life. And then some people they want to have the promise fulfilled by the insurance company and so they fight them and we help them and they deserve them. No one should have to fight as hard as policyholders have to fight insurance companies for what they're entitled to.

George Siegal: 12:57

It reminds me of being bullied in school and they're taking your lunch money. Then they rough you up, they do all these things to you and you go. But I have to fight back. You can't just let the bad guys win.

David Murray: 13:12

No, but you have to fight strategically. You have to pick the the battles that you want to invest in, and I don't look at it as a situation where it should be a fight, but that's what it becomes day in and day out, especially when it's something as personal as your home. If you're living somewhere else, it's on your mind every day, every day, and the insurance companies take their sweet time. And since there's no real repercussions, in my eyes, in the state of Florida anymore, what happens is the insurance company knows that the insurers are beholden to them, and so they will offer them low ball settlements in an effort to get them to go away, or they'll just drag it out. They will literally drag it out as long as they can, and people will give up.

George Siegal: 14:09

Now, when you see the attorneys that you go against when you're trying to help your victims and you see them, maybe after the trial or you see them out around someplace how do these people live with themselves? I know everybody's got to make a living, but that's a pretty scumbag thing to be doing to people.

David Murray: 14:26

I think there's good defense attorneys and I think there's bad defense attorneys, just like there's good policyholder attorneys and bad policyholder attorneys. In every industry there's good and the bad. The problem with it is is when these attorneys, the insurance companies that hire them, don't listen to them and don't follow their advice in trying to resolve disputes. That's when there's a problem. I can't look at attorneys and say you're bad because you protect the system, because if they're not there, then people can run amok.

David Murray: 15:01

There's propaganda with every industry of plaintiffs attorneys doing bad things, but there are also defense attorneys that do very bad things and they do it at the hands of insurance companies' directions. Whether those defense attorneys choose to have a conscience and say I am good, good fate can't do this anymore, then it will continue to occur. Some attorneys I know they have walked away because they can't continue to do what the insurance companies are asking, and then some of them, they thrive on it. It's power to them. It is power that they control people's lives in their hands, because they control the money that people need to rebuild their lives.

George Siegal: 15:45

That's just. I mean, there's nothing that really riles me up more than seeing people that have to fight for what they thought that was theirs, that they paid for. They did their part, they paid their bill every month, they took care of their house, and then, when that house is filled with water or there's stuff all over the street, to have the other side turn their back. There's not much of a worse feeling than that.

David Murray: 16:10

There's not. And the common theme that I see day in and day out after a person files a claim and the coverage has been admitted but there's a dispute as to how to fix it, the insurance company comes in and says, oh, the homeowner neglected their home, they didn't properly do proper maintenance on the home, or those damages are results of wear and tear. The difference of it is when they accepted that insurance policy and that premium a year prior or less, the insurance company didn't come in and tell people fix your home, or there's maintenance items that need to be done, or there's wear and tear that's not going to be covered. What they do is they prey on people and wait till they have a claim and then they give all types of reasons to deny providing coverage or providing benefits. And there needs to be repercussions for insurance companies doing that, because if they're taking the money, the policy premiums, and they're making this promise and they're doing it knowing that there's problems at a home, then that's predatory. That has to stop.

David Murray: 17:19

That is one of the biggest problems I see in the industry every day now is that when people file a claim, an insurance company gives an excuse as to why it's not covered. Normally it's wear and tear and maintenance related issues or neglect, and the insurance companies have the ability to underwrite it. It's kind of like when you go buy a car, you go look at that car, you sit in it, you test drive it, you make sure that that's the car you want to buy and then you go into the dealership and then you reach an agreement. But with insurance companies property insurance companies right now they don't come out to your house and look inside and outside and tell you what to fix and what might not be covered in the event you have a claim. They just take all of your money and when you have a claim then they say sorry, it's not covered, it's maintenance issues, it's neglect, it's wear and tear, and that's not right. That's just not right.

George Siegal: 18:12

I always felt like collecting a claim was kind of like you can go into a casino, you can buy chips at anywhere, you can play all over the casino, but then you want to cash them in and there's one window in the back, behind a wall, where you can get your money back. But with insurance companies they're not even going to give you your money back. There's no window to walk up to to get paid.

David Murray: 18:32

There's not and customer service has eroded so bad in the property insurance marketplace in the state of Florida you can't get adjusters to return phone calls. They're automating all of the processes, thinking it's going to help something. But when someone has a claim, they want to talk to someone. They want someone to explain the policy and the process to them and to help them work through that, and that doesn't occur in the Florida marketplace today. What happens is the insurance company won't return the phone calls.

David Murray: 19:08

The insurance company sends you checks that are pennies on the dollar for what you're entitled to and then they say let us know if it's not enough. And then you let them know it's not enough. And then they say, well, we disagree with you, go get another estimate, go get some more information. And so what happens is the policyholder actually turns into their own claims adjuster and the claims adjuster for the insurance company is not doing their job and they're fighting the policyholder. So you are right. I mean you have to fight for every last penny that you're entitled to under an insurance policy in today's marketplace in Florida.

George Siegal: 19:48

Now, one of the worst things in your video are those people that thought they had gotten things far along with an adjuster and that things were ready to be settled and the insurance company must have said oh wait, a second, we're getting too close with this. And then they switch adjusters and make them start over.

David Murray: 20:03

That's horrible, absolutely. And you have to ask yourself why does that occur? Because policyholders don't normally have multiple claims in their life. They might have one claim, maybe two, and so they're not very well versed on the process. So they don't keep log notes of everything. They don't keep everything in writing. But the insurance company is supposed to do that, but they selectively do that. So when the adjusters turn over and over, one of the first things you always get is oh, we don't have that, or I didn't get that, or it's not good information. And then it starts the process over again, and so an insured can easily be working on four adjusters or five adjusters, and there's stories of people on hurricane claims having eight adjusters within a period of 14 months. Eight adjusters. It's uncomprehensible. You just can't comprehend how frustrating that process can be if every time you call the company to get an update, every 30 or 45 days, you get told well, there's a new adjuster, there's a new adjuster, there's a new adjuster.

George Siegal: 21:17

Yeah, and they make it seem like this call is being recorded. All this information is being documented. I can't tell you how many times I've actually tested that. When you're starting over, I go. But this call was being recorded. You told me that all this information was being saved the name of the person. I mean when you're talking to them, you really have to take notes yourself. Get the name of the person the time you called all that you talked about, because you can't rely on them being good note takers, can you?

David Murray: 21:42

No, you cannot rely upon the insurance company to do their job. You have to be proactive on your own claim. You need to keep notes of everyone you talk to. When you talk to them, what you talked about, you need to send written correspondence to them after the phone call that says this follows our telephone conversation where you told me to do X, y and Z. And you would do X, y and Z Because if you are not transmitting that and writing, then I like to say it didn't occur because the insurance company is not going to write anything down in their log notes.

David Murray: 22:16

That is going to be super beneficial for you. And the other problem that we face in Florida is those log notes are the property of the insurance company. It's considered work product. So even when an insured comes to me and I file a lawsuit to prosecute the insurance company, I can't get those log notes. They're not required to give them to me.

David Murray: 22:41

So what happens is people fight for eight months or a year and then they come to someone like me to say, dave, will you help us? They go well, I talked to the adjuster and all those phone calls were recorded and they have all the log notes. And then when I tell the homeowner I understand that but we're not entitled to those, it blows their mind because they go what do you mean? Because the way the Florida laws are written, we're not entitled to those log notes. It's considered work product of the insurance company. And then when we ask for those recorded phone calls, they go oh, we don't have those recorded phone calls. Well, every time you call them it says we're recording for quality control purposes and for training purposes. But when we ask for those recordings then they say they don't exist and unfortunately judges are overworked. The court system is just GM packed right now. And so judges I think judges in the courts should examine why we're not entitled to those things.

George Siegal: 23:44

Can I record it on my end? Is that legal in Florida or any state?

David Murray: 23:51

Florida is a three-party consent state, meaning as long as the other side knows that you're recording, it's a two-party consent state. I'm sorry is both parties have to know the recording is occurring. So if you call them and they give you the recording that says we're recording it for quality control purpose. Yes, you can record it. I would caution people and say to the adjuster by the way, you're recording this because you said you are, you're recording this. I'm also recording this because I need a copy for my records.

David Murray: 24:26

And what happens a lot of times is the insurance company will say well, I'm not giving you authority to record me, and so then it becomes a problem. There was recent case law that came out in the last year or two that said it's okay for you to record the insurance adjuster at your house doing their inspection and I would encourage you to do that, because sometimes insurance adjusters come out and they inspect things within 10 minutes and then they're gone and you try to document that and there's not documentary evidence of that. But you can record insurance adjusters when they're at your home and I would encourage people to do it.

George Siegal: 25:06

I thought there was a law and I know you'll correct me because I don't really know what I'm talking about where what? If one party is covered, it's for the other party too. So if they can record you, you would have a right on the other end to record.

David Murray: 25:19

Yes, if the call is being recorded and there's notification of it, I think you can record it. But due to the fact that you may never get the recording from the insurance company telling you, hey, we're recording, I always encourage people just to say it when you're talking with an adjuster and say, listen, like you're recording the call, I'm recording it as well because I need it to document things for myself. It doesn't hurt to tell them you're also recording it. If they don't want you to record them, then you have to ask yourself why, why doesn't? If they're recording you, why do they have a problem if you're recording them?

George Siegal: 26:00

I think we know why.

David Murray: 26:02

I think most people know, and if everything is being done in the open, it's not a problem, and if they're not going to allow you to record them, then you have to ask yourself why.

George Siegal: 26:14

Okay. So what can we do then? I'm putting you in charge of fixing this problem. I mean, I don't wanna take your job away because you seem really good at it.

David Murray: 26:23

I wish you would I wish you would If you took my job away, then I know that homeowners and property owners and business owners will be a lot better protected during the insurance claim process.

George Siegal: 26:38

So how do we do that?

David Murray: 26:39

That would be a good thing, I think. Number one is we really have to look at the insurance industry and what they are doing and to actually have consumer protections that have teeth. So if an insurance adjuster is found to low ball an estimate and when I say low ball I mean they might come out and write a $2,000 estimate but then the final payment on a claim is $80,000 or $100,000, we need to ask how come no one from the state of Florida is looking at that insurance adjuster or that insurance company and saying how did you write a $2,000 estimate and then you end up paying $80,000 or $100,000? There needs to be ramifications for being that wrong and currently there's not. There is nothing wrong in our elected officials eyes when an insurance company wrongfully and woefully underpays a claim to that level. There needs to be accountability.

David Murray: 27:40

How do you do it? You do more market conduct exams. You have more investigators, investigate insurance companies and where the money is going, why so little is being paid out initially, and you need to look at the customer service. I mean, that's the business that the insurance companies are in customer service, protecting people and giving them service when they're in then the most vulnerable time in their lives sometimes, and when they're wrong, there's no repercussions. There used to be repercussions where you would have to pay attorney's fees. They took that away about a year ago, in December of 2022.

David Murray: 28:25

So now, if a homeowner comes and hires me and I sue an insurance company and they initially paid $2,000 and then they end up paying $80,000 or $100,000, now the insured has to pay us out of those proceeds attorney's fees if they want legal representation. That's not right. What's the incentive for the insurance company to do their job the right way? There is none. I submit to you. There is absolutely no reason why insurance companies now are going to do a better job than with the consumer protections we had in the past that were taken away.

George Siegal: 29:03

Now can insurance. There's probably no way to stop this but insurance, the insurance industry lobbying and contributing to politicians who then have really no incentive to tighten the bolts on them because they're getting too much money from those guys.

David Murray: 29:17

It's a conflict of interest. If you are regulating an insurance company, should you be able to take political donations from them? I don't think so. It's a bigger problem than just the insurance industry. I mean, there are issues that just continue to be magnified when you have insurance companies that have the largest lobbyists and the most expensive lobbyists and are donating millions and millions of dollars to politicians to be elected. We're not talking about one or two million, we're talking 5 million, 10 million. And now we have a bigger problem. We now have elected officials that have come in and taken away consumer protections, investing in insurance companies and starting up their own insurance companies. In the state of Florida, they passed laws to take away rights of policyholders and now they're investing in the same businesses that they are elected to regulate and they're profiting off of it, and that's a problem.

George Siegal: 30:38

Wow, this whole thing sounds like such a big problem and I'm sure we're not going to be able to solve this in a podcast, but let's give people a few action items then. So I'm going to get an insurance policy for my house. How do I give myself the best chance for success?

David Murray: 30:55

Ask the question of your insurance agent what happens when I have a claim? If I have a kitchen fire and it destroys my entire kitchen, what parts of this insurance policy are going to help me find another place to live? Hire a general contractor, pay me reimbursement for food if I have to eat out because I can't eat in my kitchen? If you have a water loss, ask them is it going to provide you full coverage to replace everything in your home? If you have a hurricane claim, ask them how much is my deductible and how much do I have to pay out of my own pocket? If I have a claim, if someone gets bit by one of my dogs on my property, do I have insurance coverage for that, or is my specific dog excluded from that type of coverage?

David Murray: 31:52

I think what happens is people buy insurance policies based upon price and not the services that that policy is supposed to provide, because everyone thinks I have insurance, I'm protected, I'm taken care of for anything that happens. But when they have that claim, then they learn oh, I only have $10,000 of water coverage. Oh, I only have actual cash value for my roof, meaning the insurance company is not going to have to pay to replace my entire roof. What happens is people need to be asking the agent what if, what if not, how much is it? Because if you ask the what ifs before you get to the price, then you know the services that you are hopefully getting for that price that you're paying the insurance companies.

George Siegal: 32:43

So when somebody is bragging oh, I just saved $500 or $1,000 by switching insurance companies, they may be screwing themselves Saving money. The game isn't necessarily to save money. It's to have a policy that's actually going to do something for you.

David Murray: 32:58

It's correct. You have to look at what you're buying and not just how much you're paying for it. But when you are buying that policy, the only thing that you are really seeing is the cost of the policy. It's the only product that I'm familiar with that you buy strictly on price and that you hopefully never have to use. But when you do go to use it, then you truly learn what are the limitations in your insurance policy. So if you buy a home, you know you're getting a home. You know what you're paying the bank. You know every last dollar you're going to pay on that mortgage. When you sign on the dotted line, you know if you get a 30-year mortgage, you're going to make payments of X amount of dollars to the insurance, to the mortgage company, for borrowing their money. When you buy a car, you know you get in the car and you leave the dealership and you have it. When you buy sporting good equipment, you get to use it right away. But with insurance it's not a tangible thing, it's something it's. You're paying a premium for a policy for protection and all you see is you're paying a premium.

David Murray: 34:15

Most people don't even get the policy of insurance until after they pay for it. You can't go into insurance agent office and go give me a copy of the full policy I'm going to buy from you. They don't have it. You don't even get this contract until weeks and weeks down the road after you agreed to it, and then people aren't going to go back and read it.

David Murray: 34:37

They're moving on with something else in their lives. So the only time that they really start to read it and understand it is when they have a claim, and that's when it's too late. So the one piece of advice that I think people need consumers need to be aware of, is you need to ask your agent specific questions of if I have a water loss, what does it mean for me? If I have a hurricane loss, what does it mean for me? If I have a fire loss, what does it mean for me? If you ask those three questions, then you can understand a lot more of what you are buying. And if you choose to say I want the cheap policy, just be aware that if you have a claim, you're going to get a cheap fix potentially.

George Siegal: 35:24

Are you hopeful? We can never make this problem better. I mean, is there hope here for us?

David Murray: 35:29

There absolutely is hope, and I think the hope begins when people start understanding that that insurance is is a business that needs to be more focused on customer service. We're focused on explaining what people are buying, because if you know what you're buying, maybe you choose to pay a little bit more. Right when you go to the grocery store. You can buy the generic brand or you can buy the name brand, but at least you're informed and on the little stickers you can see this is 38. You know sense per ounce and this is 62. But you know what I really want the Heinz catch up versus the. You know the generic catch up, you make that decision, but when you're buying insurance you don't know what you're buying until you need to use it. And so if we make people accountable to explain the benefits from the outset of the process, I think it will be a much better process, that People will be more informed. And then what happens is, if you have a claim and and you have an actual cash value policy, you understand that you paid two thousand dollars for that policy and you're not gonna get a full roof replacement. You're gonna have to come out of your own pocket five or ten thousand dollars, but you chose to save, you know, a thousand or two thousand dollars when you bought the insurance product. That's the problem people think they're buying something and they don't know what they're buying and and that's a problem with for consumers and that's a problem for the industry that's selling. It's selling a false promise to someone because when they have a claim they go look at the little print here. See, you sign this and those people people don't, don't know it's.

David Murray: 37:15

Think of it this way it's the largest contract a homeowner will ever sign in their entire life. A Insurance policy today is 50 to 70 pages long. That's how long the contract is. Your mortgage agreement is not that long. You're, you're the. Buying a car is not that long. Doing a loan for college or for educational purposes is not. Is not that long? And you're supposed to be able to read it and understand.

George Siegal: 37:48

Yeah, I think people are enamored ultimately to buy how low they can get that Monthly payment down and and that's really crazy, like when you buy a car sometimes They'll give you incentives. If you're leasing, put a lot more money down upfront that you're never gonna see again, but it lowers your payment. I think people really have to understand what that payment means and what you're getting for it.

David Murray: 38:12

Absolutely. I mean with the car, is a great example. People know I'm buying a BMW versus a Toyota, right? Some people get upside down on cars and they spend their entire life Trying to catch up for that bad car decision because they bought a BMW and and they really couldn't afford it and then they traded it in to use the equity to buy another car and another car. And some people spend their entire lives upside down on cars and then some people get to the point where they're like you know what my car is paid off. And it might not be a BMW, it might be a beater, but it's paid off and I'm gonna catch up. I'm not gonna continue playing the the game.

David Murray: 38:55

But with insurance you have to have it if you have a mortgage. So you have to buy some insurance product and insurance companies know that. So when the industry is gone is let's take away coverage, and Yet premiums have not reduced at all. All we have is a different excuse as to why insurance premiums continue to rise. You know first it was. You know it was mold claims, and then it was sinkhole claims, and then it was water claims, and then it was Roofers and then it was attorneys fees. Now, then you know, once we pass and we take away all the consumer protections, in December of 2022 we said it's going to lower insurance premiums because we've taken the bad Actors and we've taken the bad issues, the opportunist issues, the opportunist issues out. And in the last year you have only seen insurance premiums double and they continue to get higher and higher.

David Murray: 40:02

And now the new excuses is oh, the cost of construction is much higher. Oh, reinsurance cost is much higher. The difference with it is is, they say, reinsurance cost, and that's the insurance that insurance companies buy to hedge their bets. Reinsurance costs are up 30 and 40 percent. That's what they're saying in the marketplace, yet premiums for homeowners continue to double. So if the reinsurance rates are only going up by 30 or 40 percent, why are insurance premiums being doubled? Where's that extra money going? And we live in a day and age when AI is supposed to reduce the workforce because we can automate certain processes. So I question why are insurance companies not investing in that automated processes to reduce the cost? And if they reduce the the cost of the product, then it will help consumers and consumers will potentially hopefully buy more.

George Siegal: 41:09

Yeah, it's hard to know, in listening to everything that you're saying, how we can actually fight for, how we can actually fight back, and I think, like you're saying, knowledge if we at the bottom, all of us we have to demand more and not just accept this transaction as being something that's going to save us, because the the deck seems really stacked against us.

David Murray: 41:27

It is and in part of it is, is that you see, big business is getting bigger and you're seeing smaller businesses Shrink or be absorbed by larger businesses that want more market share, and that's actually what's happening a lot in the Florida market places. You have More companies getting bigger and bigger, and if you have bigger companies but you have fewer companies, than you have less competition. And we also have another problem going on that people some people talk about and some people don't talk about, and Wherever you fall in the spectrum of global warming and what's going on with the earth, I think we can all agree that storms are bigger, storms are more severe and there's more frequency of Storms, and so what you have with that is you have more claims, and when you have more claims in Florida at least, the larger carriers, the more national carriers that spread risk all throughout the country or the world, they are looking at it. I think they understand that they're modeling and they're forecasting for losses is wrong, and so they're actually receding out of the state of Florida, out of the state of California, out of the state of Hawaii, these places that are more susceptible to losses. And then you have these hedge funds opening up, these what we call Florida insurance companies, which means that it's just hedge funds putting money in to start insurance companies because they think they're gonna make a lot of money, because there's less competition in the space and we're allowed to keep increasing premiums.

David Murray: 43:09

And and no one no one on the legislative level is is is looking behind the insurance companies and saying you know how much money are you guys making? And I don't mean just the company, but I'm talking all the affiliated companies, I'm talking the, the managing general agents, the, the TPAs, all of the ways that insurance companies funnel money out of the insurance companies and make it look like they're not making that much money. That needs to be examined and and there needs to be transparency and reporting. Why did why insurance companies get to claim trade secrets to everything and not report their actual earnings and where money went and and who is paid what? That that's not. That's not good for the consumer.

George Siegal: 43:57

I think we need to start electing better people, because if you're an elected official and You're not concerned about this and wanting to fix it, you must be making money from it, because I don't know how you could not want to fix this problem.

David Murray: 44:09

Well, their idea of fixing the problem is not fixing the claims Problems. Their idea is let's just find a way to make insurance cheaper Because they're concerned about. If it's cheaper, then the system will continue going on and on, meaning banks will end money, the real estate market will continue, businesses will continue to be in business. They they're not looking at the claims side of things, they're looking at the purchasing of policies of insurance. At least that's what I see. So they're saying if we don't have insurance then we're gonna have big problems.

David Murray: 44:49

But I tell them, yes, but you're allowing and you're encouraging people to sell Crappy products to a consumer with a false promise that they're buying something of value. And when you're paying you know $3,000 a year for an insurance policy that has $10,000 worth of water coverage and you live in a two-story house with two bathrooms on the second floor that they could burst. I mean that that's not reasonable. Your littered Water losses make up over 65% of losses in homeowners claims and people are paying $3,000 for a premium for $10,000 for the water coverage. I mean they get other coverage, don't get me wrong. But if 65% or plus of the claims or water losses from plumbing fixtures and things, is that reasonable? I don't think it is.

George Siegal: 45:47

Well, you've convinced me. I need to be living in a tent somewhere or renting.

David Murray: 45:53

I think we need to understand that insurance has a place. It is something that people need and it is something that can provide benefits. The problem with it is that we've allowed insurance companies to do whatever they want to do in the state of Florida. They file new forms every day with the state of Florida changing the terms and conditions of the insurance policy, and they rubber stamp it. We have something known as a consumer advocate in the state of Florida. How are they advocating for the everyday policy order to make sure their claims get paid? How are they making sure that they're advocating every day that policies are being sold to people that know what they're buying? Those people don't know what they buy. They just get a policy and they think they're protected, and they're not.

George Siegal: 46:52

We need to wake up.

David Murray: 46:54

I think the bigger thing is we need to get customer service back into it and we need to take money out of the lobbying efforts of insurance companies in the state of Florida. We are now a year past the huge legislation last December that was supposed to solve the problems and it hasn't solved anything. It's only created bigger problems. Insurance companies are more beholden today than ever before because the consumer protections are gone. They give up, they take what they can and they try to make it work when some people they shouldn't even try to repair their homes. Unfortunately, some people unfortunately can't afford a home anymore. They might have a home and then they have a loss and then they don't have insurance because they couldn't afford it. Then they have an asset that has been greatly devalued and they don't have any insurance products until they lost money. People have fixed incomes that pay off their houses. They're not buying insurance anymore. If they have a loss then it can devastate them.

George Siegal: 48:12

We've interviewed people who, even though they're not living in their house and they can't get the money to fix their house, the bank still wants that mortgage payment every month and they still have to pay their insurance every month. It's like life goes on. They just can't do anything about it.

David Murray: 48:28

What happens, too, is when you have a mortgage. If you don't provide proof of property insurance, then the mortgage company will go get something called Force Place Insurance. That Force Place Insurance only covers the bank's interest in your property. Some people have a false sense. Well, the mortgage company got insurance, so I have insurance. But that insurance is not for you, the homeowner. That insurance is for the bank. That insurance says to the bank if you have loaned $100,000 out on this house and there's a loss, the mortgage company will be protected up to $100,000. But the mortgage company can take that money, pay off the note and move on with their day. They don't have to let the homeowner use that money to fix the house. By the way, force Place Insurance is like three times the cost of regular homeowners insurance and it doesn't have all of the same coverages. If you have Force Place Insurance, please go get something else, because you don't have insurance. The bank has insurance.

George Siegal: 49:35

We interviewed a guy in Fort Myers Beach that has that problem and it just seems hopeless.

David Murray: 49:42

In his mortgage agreement it says that the bank will make the decision if they let him fix the home or not. Most mortgage agreements say the bank makes the determination if the house is repairable and if they're going to let you repair it, because when you have a loss sometimes they can just take the money and apply it to the principal balance and move on. That's another issue that's currently in the state of Florida that not a lot of people are talking about, and that is what are your rights as a policy holder under a mortgage agreement. Again, it's big businesses lobbying politicians and giving money and political donations to do what they want to do so that they can continue to exist and the little guy will continue to suffer.

George Siegal: 50:31

Well, I hope we've opened a lot of eyes today, david. I mean, you know, this is one of the things that drives me, because I just hate seeing this happen to people when you meet them and you see that their lives are so messed up. Keep fighting the good fight and appreciate what you do.

David Murray: 50:46

I appreciate you having me under it.

George Siegal: 50:48

Thank you for joining me today. I know a lot of you have stories of your experience as a homeowner Now, whether it's good or bad, I'd like for you to share it with me. There's a contact form in the show notes. Fill it out and you might be a guest on an upcoming episode. And if you'd like to follow the progress of our documentary film Built to Last by Orbeware, I've also included a sign up form for our newsletter and that's in the show notes. Thanks again for listening today. See you next time.