Long-standing litigation could be nearing resolution
Louisiana’s Citizens Property Insurance is in the throes of litigation due to the actions it had taken in 2005 during Hurricanes Katrina and Rita. A total of 18,573 plaintiffs filed a lawsuit against the state-run insurance company, claiming that it did not properly follow its own claims policies in the wake of the catastrophic hurricanes. The lawsuit has been tied up in the legal process for several years, but the issue may be close to reaching a resolution.
Plaintiffs could receive some $3,000 by January 2013
According to lawyers representing the group of 18,573 people, each plaintiff may be able to get at least $3,000 from Citizens. Earlier this week, Citizens Insurance turned over $105 million to the Jefferson Parish Sheriff’s Office, which will be held for the time being. Hearings will be held to determine how this money will be issued and how much of it will be used for attorney fees and the other costs associated with the ongoing legal battle. Depending on the outcome of the litigation, plaintiffs may see pay outs between November 2012 and January 2013.
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Catastrophic hurricanes continue to have an impact on insurance industry
Though Hurricanes Katrina and Rita happened seven years ago, the disasters continue to have an influence on the insurance industry and those living in areas affected by the storms. Several insurance companies that served the areas affected have long battled with the events that occurred in the wake of the catastrophes. Accusations of malpractice and fraud have caused some insurance companies to shut down, while others have been subjected to lengthy legal battles. Citizens Insurance is one of the insurance companies that has struggled with consumers, but its legal troubles may have finally reached an end.
Citizens Insurance may be at the end of its rope, legally speaking
State officials, including Insurance Commissioner Jim Donelon, believe that Citizens Insurance has exhausted every legal remedy that was available to the company during the entire legal process. Donelon notes that the money that is expected to be awarded to plaintiffs has already been removed from Citizens’ bank account. The remainder of the litigation process may be nothing more than determining where that money will go.