I found a parcel of land I wanted to buy and it happened to be in the flood plain zone. I contacted local Allstate agent and asked for insurance premium quote which he said is roughly $500. As closing time came it turned out I need to do flood check, flood survey (pay), and finally real qoute annual premium happened to be $2,000 per year. 4 times more than I expected. I had asked the agent 2 months ago for the insurance premium qoute and had given me the number $500, it turns out as he said it was a "rough" quote and not real quote so it varied...varied by 300%. By this time I had paid the earnest money, appraisal fees, inspection, etc, total over $5,000.
Because of such premium I dicided not to buy the land and when backed out obviously seller kept my earnest money deposit and in the end I lost $5,000. I contacted agent and stated the problem and told him that I made the decision to buy the land based on his quoted prem of $500 but he said he is not respposible. Can I sue for 5K?
2006-10-24 13:50:01 · 8 answers · asked by insurancelawcase 1 in Business & Finance ➔ Insurance
Clarification:
-Agent had no disclamers in his email, no fine print
-No real estate agent was involved
-Agent never mentioned the need for elevation cert. I told him that elevation might be needed.
-Agent said he knows the area well and familiar with flood coverage premiums for that location
-Premium qote was in writting (email)
2006-10-26 10:40:00 · update #1
When complained to his boss he recommended to contact State Department of Insurance (SDI) and laughed...saying compaint will be closed shortly after by this pathetic department.
2006-10-26 10:42:50 · update #2
1) TWO (2) months in advance I notified the agent in writting and stated that flood certificate and evelevation test might be required and if yes, then most likely it'll result in higher annual premium since new certificate and evelation level will not qualify for "grand fathered plan" that those with policies purchased 20 years ago.
2) I specifically state that if evelation cert is needed and need to pay for survey and high premium...it'll break the deal and asked for confirmation so that I can back out of the deal and lose nothing. But he once again assured me it'll be $500/year premium.
3) Allstate corporate office making run around from SDI to the agent, to manager, to their legal department in an effort to impede the process.
What can I do? This has caused me mental distress and frustration.
I don't want any money for suffering just trying to recover what I lost due to his negligence/untrue statements.
Any law firms you can recommend that specialize in such cases?
2006-10-26 10:49:10 · update #3
If you have written proof of his estimate, read the fine print. If it says the quote is within reasonable limits, you can take him as well as the insurance company to small claims court. It generally costs about $35 to file.
2006-10-24 13:57:20 · answer #1 · answered by mrscmmckim 7 · 2⤊ 0⤋
Most insurance agents I know refuse to "quote" flood insurance without an elevation certificate because of what happened to you. An even with an elevation ceriticate agents will add a disclaimer as flood insurance is so blooming complicated no one can get it right every time.
As others have pointed out flood insurance is run by FEMA. Remember that name........FEMA the same guys that botched the response to Katrina. The Allstate agent is caught between the Devil and The Deep Blue Sea so to speak. He has to rely on a Federal Agency of PROVEN INCOMPETENCE but yet you have to have some reasonable expectation of accuracy. For that reason many agents refuse to quote flood insurance at all and those that do often require an elevation certificate and then the smart ones put a disclaimer on their quote even through they have the elevation ceritificate.
I hope ;this has helped you some. It is a no win situation for all concerned but that is what happens when Government tries to run things.
One other point I will make please. Things like this should be handled by a real estate agent. Did you use a real estate agent? If you did they should have known of the need for an elevation certificate.
Good luck and best wishes.
2006-10-25 09:14:18 · answer #2 · answered by barrettins 3 · 0⤊ 0⤋
I am not sure if you can take legal recourse against the insurance agent. After all it was only a quote. Without an elevation certificate for a flood insurance quote there is no way to get an accurate price. All flood insurance is issued through the federal government and not the insurance company. If you supplied an "elevation certificate" to the agent and the quote was still that far off then you may have recourse but if you just gave an address and general information then you have nothing to go on. Sorry.
2006-10-25 00:17:55 · answer #3 · answered by Badkitty 7 · 0⤊ 0⤋
Sure you can sue, but you probably won't win. If you got a written quote, it probably has a disclaimer on it, subject to verification of flood plain zone. If you didn't get a written quote, it's an "indication", also called a "ballpark" number, or in my office, a PANOUYA (pull a number out of your a**).
You expect the agent to know the elevation (flood survey) of every square inch of land in your state, off the top of his head? It's not a "reasonable" expectation. He had to guess, based in info YOU gave him. If you told him it's a flood plain Z, that's how he quoted. If it's now an A, well, the quote changes.
FYI, flood rates are set by FEMA. All rates are the same. Insurance companies have NO authority or "pull", and there is NO negotiation on flood rates or terms, because it's a federal program.
Sorry.
2006-10-24 14:31:14 · answer #4 · answered by Anonymous 7 · 2⤊ 0⤋
You can sue anyone for anything! However, there is absolutely no way you would win because you're suing the government, and we all know how this will end up. Flood insurance is offered through a governmental agency (FEMA), and there is no other option for flood insurance-one set price. It's a tough lesson to learn, but suing the government is not going to get you anywhere.
2006-10-24 14:36:58 · answer #5 · answered by Rexy 3 · 0⤊ 0⤋
if it's a parcel of land w/no building, structures, etc., what does the $2K of insure for? This scenario on its face is incomplete. If you have no structure the only insurance you should have been required to purchase was public liability insurance, and that should be nowhere near $2K unless it is many acres. Unless you had a course of construction quote for the building coverage, that's another story.
2006-10-25 17:37:26 · answer #6 · answered by NYradicalone 1 · 0⤊ 0⤋
If it seems like to good a deal it probably is. They will sell you flood insurance. Just try to get the check for the damages when you actually have a flood.
2006-10-28 12:30:07 · answer #7 · answered by friendly advice from maine 5 · 0⤊ 0⤋
You probably can sue, but it will cost you more than $5,000.00 to retain and pay an attorney to fight AllState.
In the future I would get the quote in writing, then you have grounds for a suit.
2006-10-24 13:53:54 · answer #8 · answered by EAA Duro 3 · 2⤊ 0⤋