SoCal homeowner sues Liberty Mutual for not renewing her policy

A Southern California homeowner is suing Liberty Mutual Insurance Co. for declining to renew her longstanding insurance policy, accusing the company of dropping her for bogus reasons.

In the proposed class-action lawsuit, Maria Badin said she had been a Liberty Mutual customer since 1993, when she bought her home in Poway. She alleged that in late August, the insurance giant sent her a letter saying it would not be renewing her policy because an underwriting review involving an aerial inspection of her property had determined that there was “algae/mildew/mold/moss” on her roof.

Badin said she was not aware of any contamination issues. Soon after, she hired an independent, licensed roofing company to inspect her roof, which she said found no evidence of algae, mildew, mold or moss.

“Driven by a desire to maximize profits, property casualty insurance companies, including Defendants, have engaged in a troubling trend of dropping California homeowners’ insurance policies like flies,” said the complaint, filed Dec. 19 in San Diego County Superior Court.

Newspaper Ads Canyon Crest CA

“Homeowners, who have dutifully paid their premiums for years, have been, and are, being blindsided by Defendants’ nonrenewal notices informing them their policy will not continue — for stated reasons that are demonstratively false.”

If a judge grants Badin’s request to make the case a class action, it would be broadened to include some number of Liberty Mutual customers who were also denied renewal “based on a condition of their property that was misrepresented by Defendants,” according to the suit.

The lawsuit comes as insurers have been pulling back from California’s home insurance market en masse, often citing the risk of catastrophic events brought on by climate change. State Farm General, Farmers, Allstate and other companies have all declined to write or limited new policies, or tightened their underwriting standards.

The firms are blaming wildfires, inflation that raised reconstruction costs, higher prices for reinsurance they buy to boost their balance sheets and protect themselves from catastrophes, as well as outdated state regulations — claims disputed by some consumer advocates.

That has led to a flurry of activity in Sacramento aimed at making coverage available and affordable. On Monday, the state released another regulation aimed at easing California’s home insurance crisis, allowing insurers to charge homeowners higher premiums to protect themselves from catastrophic wildfire claims.

In her lawsuit, Badin said she emailed a copy of the roofing company’s findings to Liberty Mutual with a request for the insurance provider to rescind its nonrenewal. Liberty Mutual responded in early October, saying the issues “appear to still be present at your property” and reiterating that the decision remained valid, according to the complaint.

Badin, who said she now pays more money for “a reduced quality of coverage” with another provider, is asking the court for punitive damages.

A spokesperson for Boston-based Liberty Mutual said Friday that the company does not publicly comment on litigation.