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MADISON - ST. CLAIR RECORD

Wednesday, April 17, 2024

After fire, late paying property owner sues insurer

A property owner who customarily paid her insurance premiums late, is suing the insurer because it denied payment of a fire claim.

The fire that destroyed Teresa Stephens' Wood River property, and killed a tenant, happened two weeks after her policy was cancelled by USF Insurance Co. for non payment of premium. Stephens' property at 20-28 Wood River Ave. burned down Aug. 19. Douglas Kibby died in the fire.

Though her policy with USF was canclled Aug. 5, Stephens claims over many years she had a history of being late with her premium payment. USF Insurance and its agents accepted the late payments in the course of business, Stephens claims.

According to the complaint filed Nov. 30, the limits of the policy issued were $181,000 for damage or destruction of the building with a general aggregate limit of $500,000 with debris removal costs. Stephens' suit seeks to recover more than $50,000 in damages.

“Defendants, by its agents, Premium Financing, whom finance a payment schedule for the benefits of USF Insurance for premium payments, accepted payments for premiums by Stephens on Aug. 8," according to the complaint.

Stephens also claims that prior to the Aug. 19 loss she never received a cancellation notice. The notice came Oct. 28 along with a check from Premium Financing dated Oct. 14.

USF Insurance Co. “failed and breached” its duty to properly provide her with proper, timely notice as required by her policy, Stephens claims. According to Stephens, the policy requires written notice of cancellation 10 days before the effective date of cancellation if the reason is for non-payment of premium.

Stephens also claims that USF failed to honor the policy in the following ways:

  • Investigate the loss promptly and thoroughly;

  • Give her credit for premium notices paid and accepted by defendant and its agents;

  • Pay or settle the claim without conducting a reasonable investigation, and failed to make any offer after making said investigations; and

  • Acted in bad faith by protecting its own interests without considering insured’s interests.

    Represented by Ron Pitts of Wood River, Stephens' case has been assigned to Circuit Judge Andy Matoesian.

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