Wednesday, December 17, 2003

Another day, another form letter. Picareli sent another one, acknowledging the inquiry from the California Department of Insurance. At least we know that State Farm is in their system.

The next few weeks are going to be tough, seeing as how everyone goes on vacation for Christmas and New Years. I'm going to take some time off, as well, but will be using the time to gather more media and legal ammunition.

Tuesday, December 16, 2003

Team Leader Picareli called again. I have no idea why he called, other than to ask me if the letter I sent (last week) contained any "new information." I wasn't sure what to tell him. That more state, federal and local agencies had been contacted?

Again, he asked me to fax him the letter. At this point, I felt it only fair to ask him why, after the horrible way State Farm has treated us, should we do anything to make his life easier?

The only interesting part of the conversation was his admitting that they did not perform a thorough investigation. He admits it. He said, "Judging by the evidence, we're making a reasonable assumption..." I pointed out that it's exactly that -- his assumption -- that's screwing things up. I also pointed out that if they were to actually inspect the damage, they wouldn't have to rely on assumption.

Once again, the man resorted to reading me chapter and verse from the State Farm Avoidance and Denial Handbook.

We're looking at attorneys now....

Saturday, December 13, 2003

Winding my way through the web, I'm finding all kinds of people with similar stories, where State Farm ripped them off for similar circumstances:

"Jim of Plant City FL (7/14/03):
Our pool drain pipe busted, causing all the water to drain from our pool and the walls and floor to bulge. State Farm sent geologists and engineers out to drill. The engineer determined that the breaking of the drain pipe was caused by the sudden collapse of dirt and slurry under the pool caused by an artesian well and limestone. State Farm denied our claim by stating that the drain pipe broke because of "normal wear and tear." We have hired an attorney and are seeking mediation and possible legal action if our pool is not replaced."

There's no artesian well on the second floor of my house, I promise you. What you have here is a sudden break obviously NOT caused by wear and tear. State Farm's response is typical. They're trying to bury this guy. lists a fair number of stories about consumers' plight with State Farm. It's a very fair list: sometimes the consumers are out of line. This one, however, hit home.

Makes you wonder why State Farm, a Fortune 500 company with 2002 revenues of over $42 billion (with a "B") can't tend to business.

If you have a minute and REALLY want to get freaked out, read this one:

"Breanna of York PA (7/11/03):
On June 7, 2003 our basement flooded to over a foot of water. We immediately called a plumber to come help us with the problem. We then called State Farm to ask what we need to do next to get the water out of the basement. (Note: our basement has two big rooms - one furnished, one not). The State Farm rep we spoke with was David R. He "authorized" us to call a company called Service Master to come to the house and start the process of cleaning out the basement.

So we called Service Master and they came over and pumped between 3,000-4,000 gallons of water out of our basement. This is not including what the plumber had already pumped out. Just to remind you, the only reason Service Master is at our home, is because State Farm authorized them to be there. So they continue to do their job and pump out water and take up the carpet. We were never told, by ANYONE, this would not be a valid claim, therefore we assumed everything Service Master was doing was routine procedure. We were told by State Farm (David) that Service Master's services would be free. (And if you listen to the recording State Farm has of that conversation, you will find this to be true).

But when Service Master was finished, they informed us that we were to pay them our deductible ($500) and then State Farm would take care of the rest. So we went ahead and paid them the $500, although it seemed fishy. This all happened on a Saturday night, so we had to wait until Monday for State Farm to call us and give us our claim number. They called Monday and informed us that our claim will not be covered and we have to pay for the remainder of Service Master's fee's (which ended up being over $2,000). Needless to say, I was furious. I called State Farm and spoke with our agent, Trish Howser, and told her of the situation. She was no help at all.

I then spoke to another State Farm Claims rep and she told me that they (State Farm) never told us to call Service Master and also told us that this claim would never be valid. She also said that Service Master told us this claim would not be valid as well. (Service Master never said that - they actually quoted us around $8,000-$10,000 worth of damage - I have that conversation on video tape so I CAN prove them wrong). Everything this lady was telling me was a lie, so I told her the gentleman's name we spoke with and had her listen to the recording of that conversation. She called back and said that I was right and that State Farm did authorize us to call Service Master. But she denies they told us it was free. (Surprise! Another State Farm lie). So she told me they are going to keep the $500 deductible for Service Master but then State Farm will pay the rest. Which they did - over $1500.

The problem is, we have over $10,00 worth of damage to our basement not including our personal belongings, furniture, etc. My question is, how can State Farm pay for some of a claim, but not all of it? How can you take responsibility for half? I just don't understand. I called our rep (Mia B) and told her that this was ridiculous and I expect our carpet to be paid for as well as our electricity bill, at the very least. Service Master ripped up our carpet, put it on their truck, and threw it away. So we have no carpet now. They are only supposed to lift the carpet up and dry it. Not take it and throw it away. I asked Mia why we are not covered for this damage and she told me that sump pumps are not covered in our policy. Nowhere in the policy I have, is there an exclusion for sump pumps.

State Farm doesn't even know why our basement flooded. Mia is STILL trying to get in touch with our plumber who was here that night to see what caused the flood. It has been over a month now and that tells me State Farm is not trying very hard. I call her each week to see what is going on, and she keeps putting me off. I am in the process of writing a letter to the claims department, hoping for a response. How can State Farm say they are not covering a claim without even knowing what has happened? Mia said that she would come out to the house to inspect, but that hasn't happened yet either."

Like a good neighbor, eh?

Thursday, December 11, 2003

A good thing happened today. The State Attorney General's office sent me a letter with a form for me to fill out. It was a follow up form, inquiring as to whether my case had been resolved or was still pending. It asked for all the information again, which I filled in and sent back to the AG's office. It was worth the 37¢ stamp to keep me in the system.

Meanwhile, I got ANOTHER call from Team Manager Picardi of State Farm. Now, I get it: Every time a state, local or Federal agency gets my letter, they send a copy to him. I suspect that flags him to call the policyholder so that his logs can show that he responded. So the guy calls me. Again, for no reason, other to read me chapter and verse out of the State Farm cheer book.

This time, I thank him for calling and let him know that unless State Farm is willing to investigate the damage and honor their policy, there's really no point wasting his -- or my -- time. He admits as much as hangs up.

An hour later, there's a voicemail for me from -- you guessed it -- Team Manager Picardi, asking me to please fax him the letter I sent to his office. Then he calls my office again to request the same thing.

Gee, maybe now he understands what it's like to be kept waiting. Hope my delay doesn't infringe on his Christmas far as I'm concerned, he can wait for the U.S. postal service just like everyone else. Grrrrrrr.

Finally, I need to go on record and document something else that's really weird. State Farm has issued me a check to cover the hole they tore in my ceiling. It's check #1-23-026431 for $479.92. That's fine. What's weird is that the Coverage Description on the check is coded for "Water/Freezing - Building". At least it documents the Loss Date as August 27, 2003.

Wednesday, December 10, 2003

Yesterday I mailed off the following letter to our Team Manager at State Farm. I wonder if they even read these things. I know that they're incredibly anal about their faxes. For example, a policyholder cannot fax anything directly to an adjuster. At State Farm, the fax must go to their central office for scanning and then be forwarded eletronically to the adjuster. Which means it can take up to 3 days for your adjuster to receive a fax that arrives in two minutes.

Sort of defeats the whole purpose of faxing, no? It's the same with their letters. Even though this genius works in Westlake Village, the letter has to be sent to Bakersfield. You're probably reading this before he is....

Here's my latest response to State Farm:

"December 6, 2003

Richard Picarelli
P.O. Box 21330
Bakersfield, CA 93390-9819

Dear Mr. Picareli:

In your correspondence of December 3, 2003, you and your “investigators” once again fail to grasp the reality of the circumstances involved in our claim 75-M368-089.

In that letter, you once again mistakenly conclude that 'the damage to your home was a result of a continuous or repeated leak due to a deteriorated shower pan.'

Once again, let me remind you that we are NOT claiming damages as a result of any shower pan leak. We are claiming the sudden break in the shower pan, which two independent experts have confirmed was sudden, not the result of damage over time.

Your letter asks that we forward additional information:

Claims and complaints against you have been filed with the California State Department of Insurance, the Better Business Bureau, the California State Attorney’s Office. A public website has been launched to collect similar case studies involving State Farm via And investigative reporters across the country are following this case – including your correspondence -- via

I hereby reiterate my demand that State Farm find coverage for repairing the shower pan as this sudden break is most definitely covered by our policy.


Rob Frankel"

Monday, December 08, 2003

Holy cow, take a look at this story submitted by Diane in Florida. When you start reading, it sounds like just another story. But it's not "just another story." This time, State Farm actually said they'd cover a leak, then reneged, then eventually paid for the leak! This is the perfect story about how you absolutely must hammer State Farm over their heads until they wake up and do the right thing:

"I will tell you my story, just DO NOT Give them my name. I live in the state of Florida so I'm basically stuck. We can't change companies as NO ONE wants to write us in Florida. I have had my home, car and boat insurance with State Farm for over 20 years.

"I had another insurance company prior. We kept hearing water running, and our water bill went sky high. I did not see any leaks or anything but I called a plumber. Seems we had a Leak in the copper pipe (UNDER THE CONCRETE FLOOR) under the house. They had to jack hammer thru the floor to repair it. The insurance company REFUSED To pay, I was SO MAD.

"I called around, and ended up with State Farm, who assured me they DID cover leaks under the floor. 

"Well, about a year later, the SAME thing happened again but in another place. I called the leak detection team, and sure enough they found another leak. Before we did anything else we called State Farm. They sent out an adjuster (about a week later). Of course all this time, we were having to run outside to turn OFF the water and on when we needed it It was a real nuisance.

"Finally, the adjuster got back to me and told me that was NOT a covered expense. Because pipes were NORMAL Maintenance. I was LIVID and asked what kind of NORMAL maintenance people would do on pipes underneath a house. He could not answer that. Then I said well what if I just DO NOT fix it and it causes a sink hole, and the house falls in, and he said then that would not be covered because I knew of that and didn't exercise reasonable care.

"We ended up getting a plumber to replumb the entire house so the pipes would NOT be under the floor anymore. Meantime, we filed a protest and a complaint with the insurance commissioners office. We were really very mad because we ASKED about this specific condition BEFORE we chose State Farm and we were told it WAS covered. I put that into the complaint as well.

"On their behalf, I would say the Agent that sold us the policy did admit to them that he had told us that was a covered item. Due to that, and our consistent follow up, with calling, writing and complaining about 8 or 9 months later they agreed to pay for the "repair". The only thing is we could not wait that time without fixing so we had to replumb the house , and they said that was NOT covered. HOWEVER, we finally got them to agree to paying about $1200 which was what it had cost us for the prior one, from the other company. 

"I was NOT at all happy with the way they stalled and put that off. For the money we pay for the insurance, I feel things should be covered without such a runaround. 

"Being in the state of Florida I have no recourse but to stay with them, because no other companies will cover us. If you get dropped you have to go to the state and pay astronomical rates.

"So that's my ONE claim experience in 20 years, but they NEVER have a problem raising my insurance every year.

"If I can help with anything else let me know. Regards, Diane"

Saturday, December 06, 2003

Amazing. State Farm just keeps on cranking out the bullshit. Today, a letter from Claim Team Manager Richard Picarelli, (818) 865-4651, arrived which is his supposed response to the inquiry launched by the Better Business Bureau. Check out the text of his letter. This guy STILL doesn't understand what's going on:

"This letter responds to your correspondence of November 25, 2003 to Claim Manager John Strange and your inquiry to The Better Business Bureau.

"We have reviewed your claim again and regret to advise that we continue to find no coverage for your loss. Our investigation determined the damage to your home was a result of a continuous or repeated leak due to a deteriorated shower pan. Your Homeowners Policy excludes these damages. Please refer to our correspondence dated September 19th and November 14th, 2003.

"I regret we are unable to find coverage for your loss. If you have additional information or questions, please contact me."

Well, there you have it. The part about determining "the damage to your home was a result of a continuous or repeated leak due to a deteriorated shower pan" tells you everything you need to know. We're not claiming damage FROM the shower pan. We're claiming the sudden break IN the shower pan.

These guys just don't listen. And they obviously don't care. Judging from the people who have written to me, they don't care about much.

I'm composing my written response to the Team Manager so that they know I am not going away. In the meantime, more reporters are calling. They sniff a story here.

Thursday, December 04, 2003

For what it's worth, I received a nice form letter from the State of California's Department of Insurance. Nothing terribly original about it, but it is nice to read about all the stuff that they plan on doing. My address is custom printed on the letter, but the signature from the state's Associate Insurance Compliance Officer is part of the form letter.

At least I'm in the system. Now it's a race to see who's going to strike first: the state, the regulatory agencies, the Better Business Bureau or the media.

A TV reporter from Illinois called today to get the story. She asked me why I contacted her if I'm in California. I told her there were two reasons:

1. Illinois is State Farm's home state
2. When an issue hits the web, it becomes everyone's issue. In fact, the web is the tool that allowed me to discover how many others across America have been ripped off in a similar fashion.

We're only a week or two old. The story is gaining traction.

I also have posted the year's worth of articles about State Farm's misadventures with its policyholders at

The link is in the middle of the page.

Wednesday, December 03, 2003

The incoming stories from real victims continue to amaze me. Today, I received this from Mark (I've withheld his last name) who has been a professional adjuster himself. I'm including my responses to him:

At 11:41 AM -0600 12/3/03, Mark (Last Name Withheld) wrote thusly:
MARK: Rob,

I've handled property insurance claims, including homeowner's losses for over 20 years, both as an independent and staff adjuster. While I was an independent, I handled some homeowner's claims for State Farm. As a staff adjuster, I worked for Fireman's Fund, the Hartford, CIGNA and ACE USA. And in that time, I've handled many claims for leaking and broken shower pans.

ROB: Hi Mark:

I'm interested! Always can use some good information.

MARK: As an experienced adjuster, I can tell you that what the claim representative may have been looking for is evidence of a sudden and accidental break in the shower pan as opposed to wear and tear or deterioration over a period of time. Most homeowner's policies would pay for one loss and probably exclude the other. Even so, many policies have language, for example, that will pay for repairing a broken pipe within a wall even if the break occurred from corrosion over time. Yours appears to have such language. In my experience, however, shower pans, depending on their construction and installation, are a major maintenance problem and, as a result, are a major leak hazard.

ROB: Here's the first issue: By all accounts (from leak detector people and plumbers) this was a sudden break, although neither speculated as to the cause of the break. As I write in the blog, even the State Farm agent said that "if a 500 pound man was in your shower and the shower pan broke, that would be covered."

At that point, I told him that indeed, I NOW remember a 500 pound man jumping up and down in my shower! NOW will you fix it? Obviously, he said no. But the point remains: State Farm would cover it if it were a sudden break. They simply choose not to view it that way, because they haven't investigated it thoroughly.

MARK: Your story did not have sufficient details to assess whether or not State Farm made a fair decision based on your insurance contract but their bedside manner certainly seems to have left much to be desired. As I'm sure you know, no homeowner's insurance policy is meant to be a maintenance policy on your home although many people today, especially in tough economic time, try to use them that way.

ROB: Absolutely. And I'm not a hand out kind of guy. I repair my own sprinklers, seed my own lawns, etc. I can't even remember when I last filed any claims.

MARK: Regardless, I was taught early on in my career that my job was to find a way to pay a claim - not find a way to decline it. As such, I've always given the insured the benefit of the doubt unless the evidence against the claim is undeniable and the policy language against coverage is unavoidable. The companies that I've worked for have more or less embraced that philosophy. And I've found most of the claim reps I've worked with to be even-handed and fair-minded people. After all, they're homeowners themselves and carry the same homeowner's insurance. Hopefully, although this doesn't sound like the case with you, they treat other claimants as they themselves would wish to be treated.

ROB: I was hoping so. But I was disappointed.

MARK: Never-the-less, I continue to hear and read personal horror stories from neighbors, friends and in the media about how claims are mishandled often times from lack of experience or from a contentious attitude or mean spirit on the part of the insurer. As an example, a friend of mine had his roofing claim denied after a hail storm damaged many houses in our area including mine. Even though houses to all sides of his had major hail damage, the adjuster (not State Farm) told him that the trees shielded his roof from the hail. I inspected his roof myself, and although it was heavily deteriorated and, as such, it was difficult to discern hail damage in the asphalt shingles, the metal chimney flashings and caps had a multitude of pock marks. When I asked my friend about whether or not the adjuster had seen that damage, he said the adjuster explained away the damage by blaming it on falling acorns!

ROB: Well, there you have it: there's this attitude on the part of some adjusters that seems to be saying, "the burden of proof to get coverage is on the homeowner." Hardly the stuff of the "good neighbor" commercials we watch on TV. My sense is that since State Farm is going to have to pay out heavily for the California fires, they're putting normal, legitimate homeowners on the back burners, so to speak. Hoping we'll go away.

MARK: I told my friend that he had paid for a replacement cost policy and that even though the insurer may not wish to replace his deteriorated roofing, if it was damaged by hail, they had a legal obligation to do so. I told my friend the adjuster would sound pretty pathetic using his acorn explanation before a judge and/or jury. Instead of filing a complaint with the state department of insurance or filing suit in small claims court, my friend unfortunately chose to replace the roofing himself at his own expense because he didn't believe he could successfully fight the insurer. The worst part of it was, his insurer, after declining his storm damage claim, sent him  notice  that he had 30 days to replace his deteriorated roofing or else they would cancel his policy!  At least they didn't cancel his policy for making a claim like some other insurers have done. 

Mark (Last Name Withheld)

ROB: Amazing. Thank you for your story, Mark. I'm publishing it (without names, of course) on the blog site for others to read. This is good stuff from a real professional.

Tuesday, December 02, 2003

The good news is that investigative reporters around the country are aware of State Farm's ineptitude when it comes to actually helping the people they insure. One reporter actually forwarded a set of articles which document State Farm's repeated failure to live up to its promises. I'll be posting those articles for download a bit later.

The articles date back to 1999, appearing in serious publications like the Washington Times.

Meanwhile, here in Southern California, State Farm continues to blitz radio and other media with its "good neighbor" propaganda. At any time of day, you can hear them talk about being there for victims of the recent fires we had here.


Just wait til those fire victims (over 4800 homes were lost here) try to get their claims processed. I'm sure there will be plenty of photo opportunities for State Farm's publicity department, while legitimate homeowners are left stranded.