Haag Engineering: An Insurer's Best Friend

Following Hurricane Katrina, the third of our many Allstate adjusters finally made it to our house in October. He immediately noted the obvious structural damage to our house, and he put in an order for an engineer. Allstate hired Haag Engineering to examine our residence, which meant nothing to me at the time. When the two representatives from Haag finally showed up at our house on February 23rd, we were overjoyed. Finally, six months after the storm, we could get their assessment of whether it was wind or flood waters that racked our house. We knew that the severe winds from Katrina caused the structural damage, but everyone from Allstate who we dealt with indicated they would total it out from flood, because that wouldn't cost Allstate any money as flood is backed with federal funds. We were in the unusual position of having both wind and flood policies. "Lucky us" we naively thought. The representatives from Haag only stayed at our house a short time, just 15 minutes, and wanted no interaction from us. They were rude we thought, but maybe we had been living in the south too long and our expectations for kind small talk weren't realistic. Anyway, two months go by, and we're still waiting on their report to be filed. Mind you, people have long since gutted their houses and begun the long and tedious process of making the many necessary repairs. For those of us who had flooded houses, we basically need to gut them, treat the studs, redo all the plumbing and electricity, and then put in new walls, floors, and ceilings. But we also have structural problems, and we can't do any of the other things until we address this with our insurance company. Finally, in the mail on May 4th I received a letter from Allstate stating that they are denying our claim for any structural damage based on the Haag report, which was attached. That was one of the worst days of my life, but fortunately for us, the report from Haag was full of mistakes. For example, they refered to our house as "The Wilson house" and had pictures that weren't from our house. Also they claim things like it wasn't windy enough during Katrina to cause a house to lean, and that the many new cracks in our interior were caused from a lack of air conditioning for 3 weeks. They also ignored the most obvious evidence that our house was recently racked.

So we were heartbroken and furious, and we decided to fight back against Allstate.

Since those dark days following the claim denial, I've come to learn that Haag is infamous for being in the pockets of the insurance industry. Their spokesperson lately has been Timothy Marshall, who is Haag's damage and failure consultant. He wrote the "Hurricane Katrina Damage Survey" that insurance companies have routinely purchased as "expert testimony" and used to deny claims. By the way, Haag's online store now advertises that the book is 1/2 price at $75 "While supplies last!" Marshall's survey concludes that sustained winds were below Category 3 and that there was no tornado damage along the coast. Mind you, there is a mountain of more qualified "experts" who say that sustained winds were in the Category 4-5 range, and that there were plenty of tornados. So this one man's biased work is the primary tool used by insurance companies to deny people's wind claims, as the insurers say all of the damage was done by flood.

I'm not sure about quite a bit in this whole process. I don't know why the representatives from Haag didn't total our house out from flood damage. However, in their report they actually question whether our house flooded, though the debris line marking 3 feet of water inside is obvious on every house in the neighborhood. I don't know how people like Timothy Marshall or the two representatives of Haag who came to our house justify what they do for a living, or how they are able to sleep at night knowing that they are seriously harming thousands of people. I'm also not sure why we even had insurance. In many ways we would be better off at this point without it. FEMA would have paid for us to live elsewhere during this whole process, and we could have still received money from the Louisiana Road Home to repair our house. Right now we owe about $150,000 on a mortgage for a house that as-is would go for approximately $40,000. But we're confident, still, that in the end we'll find justice and Allstate will pay us. However, I think with great sadness about all of the people who for many reasons would just take the initial denial based on "expert" engineers from Haag and give up.

LINKS RELATED TO HAAG ENGINEERING
Several articles in a series about Haag Engineering from South Mississippi's Sun Herald Newspaper:
"Engineer Chases Storms" about Timothy Marshall from Haag (August 1, 2006 by Anita Lee)
"Experts Disagree on Winds" about Marshall's "Hurricane Katrina Damage Survey" and those who disagree (August 1, 2006, by Anita Lee)
"Engineers Called Into Question After Another Historic Catastrophe" about how Haag and even Timothy Marshall did the same thing after Hurricane Hugo in South Carolina in 1989 (July 31, 2006 by Anita Lee)
Damaging Opinions about how an Oklahoma attorney successfully battled State Farm on behalf of tornado victims. State Farm had previously denied their claims based on a report by, you guessed it, Haag Engineering (July 30, 2006 by Anita Lee)
"Saffir: 'Wind Damage Considerable'" about how Herbert Saffir (from the famous Saffir-Simpson scale) said that "wind certainly caused a considerable amount of damage on the Gulf Coast before any wave action or storm surge." (August 1, 2006, by Anita Lee)

NPR story about the "Slingshot Group" from Diamondhead MS who like David vs Goliath, are fighting the insurance industry. The residents say homes were damaged by winds, the companies say the damage was flood.

"Allstate Accused of Cheating Claiments" about the infamous "McKinsey Documents" used by Allstate to cheat clients. (by Brandon Ortiz from Lexington Herald)

"Nearly 700 File Suite Over Denied Katrina Claim" about Dickie Scrugg's lawsuit which claims State Farm “extorted” engineering firms by refusing to pay them if their conclusions conflicted the HAAG report. In addition, the action accuses the insurer of hiding or shredding engineering reports that blamed damage on wind. The lawsuit also claims “State Farm intentionally suborned and encouraged the corruption of scientific investigation and accepted physical realities ... to achieve the desired result of blanket denials of coverage.” (by AP, May 9th, 2006)