Katrina, Rita claimants to be paid
The state-backed “insurer of last resort” for Louisiana property owners has settled the remaining claims in a class-action lawsuit that accused it of taking too long to begin adjusting claims after hurricanes Katrina and Rita in 2005.
Judge Henry Sullivan, of the 24th Judicial District Court in Jefferson Parish, gave final approval Wednesday to the settlement, under which Louisiana Citizens Property Insurance Corp. will pay $4,500 to any remaining claimants.
Each claimant will get about $3,000 after one-third is taken out to cover attorneys’ fees.
It is not clear how many people will come forward to collect on the settlement and how much it will cost Citizens, which already paid out $108 million to roughly 18,500 claimants after Sullivan ruled against it last year.
Chief Financial Officer Steve Cottrell said Citizens, which insures home and business owners who can’t get coverage anywhere else, has budgeted $40 million to handle any claims resulting from the settlement.
Sullivan’s 2012 judgment against Citizens worked out to $5,000 per claim, with 40 percent going to attorneys’ fees.
Steve Mauterer, class counsel for the plaintiffs, told Sullivan that the lower settlement amount is in the best interest of the remaining property owners because it wraps up the case after years of litigation.
The lower percentage for attorneys’ fees is intended to “try to put the same amount in everyone’s hands,” he said.
Plaintiffs’ attorneys have said that as many as 40,000 Citizens policyholders had their 2005 hurricane claims mishandled, and early estimates had put the final round of settlement claimants at about 7,500 people.
Neither side was willing on Wednesday to estimate how many could come forward.
Sullivan heard testimony about efforts to inform potential claimants in plain language that they might be eligible for some of the money. About 80,000 notices were mailed out this summer to current and former policyholders.
Mauterer said only nine objections were filed by policyholders during the process, and all have been withdrawn.
Sullivan, who has presided over the case since the beginning, said the settlement “is in the best interest of the remaining class members” and called it a just resolution to a “tough fight.”
Wiley Beevers, an attorney representing the property owners, noted there were 39 writs and appeals in the case, which went all the way to the U.S. Supreme Court.