‘I am So Lost’: Black Homeowners Struggle to Get Insurers to Pay Claims

‘I am so lost’ Mr. Young, the vendor hired by State Farm to arrange repairs to Ms. Burgess’s home, has seen insurers lowballing other Bl...

Mr. Young, the vendor hired by State Farm to arrange repairs to Ms. Burgess’s home, has seen insurers lowballing other Black customers and lobbied on their behalf — even though his Los Angeles-based company, Valley Green, which specializes in fixing damaged homes, depends on insurers for business.

He fought on behalf of Langston Phillips, who almost lost his house during a fight with his insurer, Pacific Specialty. Three years ago, Mr. Phillips’s kitchen had flooded after a pipe burst, ruining portions of his three-bedroom home in Inglewood. An adjuster from Pacific Specialty determined that the company owed Mr. Phillips just over $11,000 in repair costs. Mr. Phillips’s contractor said his home needed far more extensive repairs.

Pacific Specialty asked Mr. Young to take a look. Mr. Young determined that the repairs would cost more than $33,000. A battle ensued, with Mr. Young siding with Mr. Phillips even though he had been hired by Pacific Specialty. Because of the dispute, even the sum Pacific Specialty agreed to pay Mr. Phillips reached him in increments, forcing him to move to a single hotel room with his two children while he waited for his kitchen to be rebuilt. On a particularly bad day he emailed a Pacific Specialty representative, pleading for clarity on when some of that money would arrive. “I AM SO LOST,” he wrote.

“We aim to pay claims as quickly and fairly as possible to bring the insured back to their pre-loss living standard,” said Kara Holzwarth, Pacific Specialty’s general counsel. “We find that water leak losses can be fraught with disagreement.” She said Pacific Specialty’s treatment of Mr. Phillips had nothing to do with his race.

After two years of fighting, Mr. Phillips gave up. Worried about losing the house, he moved back in and began to work weekends to pay for the repairs — replacing cabinets, flooring and plumbing — that he was doing himself. “I am bone tired,” he said.

Mr. Young, meanwhile, has noticed that most insurers are not willing to work with him. He is now suing 17 insurance companies, one by one, for discrimination, after the companies refused to add him to their vendor lists. He reached a confidential settlement in his suit against Travelers and has complaints pending against others.

“I’m the only one rattling the cages,” he said, “saying why won’t you give minority-owned vendors any work?”

Niraj Chokshi contributed reporting.

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Newsrust: ‘I am So Lost’: Black Homeowners Struggle to Get Insurers to Pay Claims
‘I am So Lost’: Black Homeowners Struggle to Get Insurers to Pay Claims
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