A class-action lawsuit filed recently in Philadelphia state court claims that Travelers is selling rot insurance to homeowners while concealing the actual terms of the proposed coverage. According to the lawsuit, Travelers Home and Marine Insurance Co. allegedly markets and sells add-on homeowners’ insurance to consumers that is supposed to provide coverage for rot and fungus damage. However, the insurance policy fails to explain that certain causes of rot damage are not included in the coverage.
What is the Rose vs. Travelers lawsuit about?
Sean and Jamie Rose – plaintiffs in the lawsuit – purchased a homeowners’ insurance policy from Travelers that included supplemental coverage for rot damage, fungus, and microbes, which added to the cost of the policy.
The add-on coverage apparently included “limited ‘fungi,’ other microbes or rot remediation coverage,” in addition to rot removal and replacement of damaged property. The conditions making the coverage effective included the rot occurring as a result of a covered cause and the damage promptly reported by the homeowners.
In August 2018, when a water pipe broke in their master bathroom and kitchen, the Roses expected to have the damage covered by their homeowners’ insurance. However, the insurance company reportedly sent a representative who claimed that the damaged pipe had been leaking for a prolonged period of time – weeks, months, or years – disqualifying the damage for coverage under the policy.
The specific letter sent by Travelers to the family in October 2018 included the following statement: “Rot is indicative of an ongoing presence of moisture for weeks, months and years. Since water damages that occur for a period of weeks, months or years are excluded, your policy does not provide coverage.”
Allegation: Travelers refused to pay rot coverage on homeowner policies
Travelers allegedly sent company representative Janene Harlieb to the Rose’s home to obtain a statement from the homeowners in the aftermath of the water damage. As Ms. Harlieb investigated the damage, she allegedly told the couple that she did not see how Travelers would provide compensation for the damage, despite the insurance add-on purchased by the couple.
In the lawsuit, the Roses’ claim that “Ms. Harlieb indicated that she was not aware of why there was rot coverage as there was no situation for which Travelers would pay for rot.” In the lawsuit, the Roses claimed bad faith insurance practices, breach of contract, and violation of Pennsylvania’s consumer protection laws by Travelers, stating: “Defendant, despite demand for benefits under the policy, has refused without legal justification or cause, and continues to refuse to pay to plaintiff monies owed for the damages.”
In the class-action suit, the Roses’ claim that Travelers manipulated its customers into buying additional rot coverage without ever intending to pay out claims under the coverage:
“The practice of Travelers in interpreting the portion of the policy, advertised as ‘additional coverages,’ despite the intention to never provide this additional coverage which is otherwise provided in this policy and was provided in previous policies, has been perpetrated by Travelers maliciously and in conscious disregard for the rights of its policyholders solely for the financial advantage of Travelers.”
The Roses, representing a Class of Pennsylvania residents who paid Travelers extra for rot coverage but were denied that coverage when issuing claims, are seeking compensatory damages, additional damages, attorney’s fees, and court costs.
Rose v. Travelers case update – July 2020
The Rose v. Travelers class action suit settled out of court in January 2020. Under the settlement, eligible members of the class action suit were eligible to collect up to $3,750. This class action suit is now closed.
At McWherter Scott & Bobbitt, we offer proactive legal counsel to victims of bad faith insurance practices in Tennessee. If you have been subjected to bad faith or breach of contract by an insurance company, our experienced Tennessee bad faith and insurance dispute attorneys can help. To work with one of our experienced lawyers, please call 731-664-1340 or fill out our contact form. We maintain offices in Nashville, Chattanooga, Memphis, Jackson and Knoxville.
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