Draining your rights? KSL Investigates insurance settlement agreements

Oct 28, 2021, 10:20 PM | Updated: 10:47 pm

MILLCREEK, Utah – Bonnie Young’s 79th birthday brought a very messy surprise.

While updating a sewer line underneath the condo complex where she lives, a plumber mistakenly blocked off a line, preventing the four condos above Young’s from properly draining.

That mistake flooded her home.

“The dining room was full of water,” she said.

No, not water. Her dining room was full of raw sewage.

Damage left behind after plumbing blunder sent sewage into condo-owner’s home (KSL TV)

“That happened way back on July 10,” Tiffany Young, Bonnie’s daughter, told us. “And we’re still waiting for repairs to begin.”

Tired of waiting, the Youngs contacted the KSL Investigators.

Demanding a settlement agreement

It wasn’t the mess nor the mistake that had Young and her daughter all fired up. It is the response they got from the plumber’s insurance company.

“They won’t release any funds to even begin repairs until my mother signs away all of her rights,” said Tiffany Young.

She said the insurance company got an estimate which is several thousand dollars lower than the bid she got. And before paying a dime, the insurance company demanded Bonnie sign an agreement that she won’t be allowed to ask for any more money, no matter what the final bill may be.

“Even if the price of the flooring goes up between the time it was estimated a month ago and the time they finally get to repairs, (or) the number of hours of labor, there’s no allowance for any change orders or supplements to their claim they don’t want to do,” said Tiffany Young.

Matt Gephardt and Bonnie and Tiffany Young examine damage left behind in Bonnie’s home after a plumber’s mistake. (KSL TV)

The women said they had tried to negotiate with the insurance company – asking them to at least pay the money they were willing to pay so work could start, before settling the final bill later.

But the insurance company refused and because they have all the money, they seem to have all the leverage.

“The alternative we had was to come to you,” Tiffany Young told the KSL Investigators.

Before you sign

We took their situation to Jonathan Pike, commissioner of the Utah Insurance Department.

“Release forms such as these are kind of an industry standard,” he said.

Pike said not only are settlement agreements common, but his department does not have the authority to step in and force an insurance company to pay if a homeowner refuses to sign an agreement. With homeowners desperate to get their homes or cars repaired as quickly as possible, an insurance company has the upper hand.

“A consumer can be strong-armed into signing if they want to get anything repaired, couldn’t they?” we asked Commissioner Pike.

“They could if they just signed and that’s where I think it’s important to not make these decisions in a vacuum,” Pike responded.

Utah Insurance Commissioner Jonathan Pike (KSL TV)

Insurance companies are generally bound by their contracts. The trouble is those contracts usually use phrases like, “reasonable” costs, and what may be reasonable to the insurance company may not be reasonable to you.

He explained it is a negotiation and when there is a stalemate, Utah law leaves it up to homeowners and the insurance company to straighten it out.

“They can either try to continue the negotiations on their own or if they feel like they need representation, they may want to go to someone like an attorney,” said Pike.

A lawyer the KSL Investigators spoke to says that when an insurance company refuses to budge, it is great to have multiple bids to show them, so they can better judge what repair costs are likely to be.

A change of heart

Next, we reached out to the insurance company, EMC, on the Youngs’ behalf.

We asked, “Why is EMC requiring Bonnie Young sign a ‘Release and Settlement Agreement’ before money will be paid toward repairs?”

And just like that, it seems they had a change of heart.

In an email to KSL, the company’s executive director wrote, “A payment for the undisputed damage amount has been issued to Ms. Young and should be received in the coming days. The parties continue to work toward full resolution of the entire claim. Beyond that, we do not go into specifics of individual claims situations.”

When asked if she would speak generally about why the company asks disaster victims to sign away their rights, she responded, “No, thank you, but we will pass.”

Sure enough, a few days later, the repairs that were three months in the making finally began, without Bonnie Young having to sign an agreement that what EMC paid will be its final offer.

“We’re just really thankful to KSL Investigates for helping us out. It made all the difference,” said Tiffany Young.

Have you experienced something you think just isn’t right? The KSL Investigators want to help. Submit your tip at investigates@ksl.com or 385-707-6153 so we can get working for you.

KSL 5 TV Live

Top Stories

KSL Investigates

FILE PHOTO - Shown are a smartphone and computer....
Matt Gephardt

Can a company pull the rebate runaround?

When a West Valley City woman took up Verizon on a rebate offer to upgrade but could not get the rebate, she contacted the KSL Investigators for help.
6 days ago
Daniella Rivera

KSL Investigates: How is Utah’s new self-defense law impacting justice?

Is a new Utah self-defense law improving our justice system or leading to unintended consequences? The KSL Investigators analyzed a full year of cases.
7 days ago
Matt Gephardt & Sloan Schrage

Utah home sellers drop asking prices as market slows from a frenzied pace

For years, Utah has been one of the nation's hottest real estate markets, but now it appears to be cooling as sellers are slashing prices.
7 days ago
FILE (Getty Images)...
Matt Gephardt & Sloan Schrage, KSL TV

Gephardt Busts Inflation: How you can save money by switching from one of the big three wireless carriers to an MVNO

We have all heard of the big guys of wireless networks - Verizon, AT&T and T-Mobile. But many smaller carriers use the same infrastructure as the big three and for you that means you can get the service you need for much less by switching to one of the other guys.
10 days ago
Matt Gephardt

Utah regulators take action against store they say failed to deliver furniture or refunds dozens of times

Imagine paying a deposit for expensive furniture only to have the company vanish before you get your stuff. It happened to several Utahns and now, the store has been cited by the State of Utah.
11 days ago
Matt Gephardt & Sloan Schrage, KSL TV

Gephardt Busts Inflation: Overstocked stores are leading to steep discounts for shoppers

Many big retailers are dealing with excess inventory. For retail businesses, it is a situation that is costing them a boatload of money. For consumers looking to bust inflation, it is an opportunity for bargain hunting.
20 days ago

Sponsored Articles

tips how to quit smoking...

7 Tips How to Quit Smoking | Quitting Smoking Might be One of the Hardest Things You Ever Do but Here’s Where You Can Start

Quitting smoking cigarettes can be incredibly difficult. Here are 7 tips how to quit smoking to help you on your quitting journey.
Photo: Storyblocks...
Blue Stakes of Utah 811

Blue Stakes of Utah 811: 5 Reasons To Call 811 Before You Dig When Working in Your Yard

Call before you dig. Even at home, you could end up with serious injuries or broken utilities just because you didn't call Blue Stakes of Utah 811.
Days of...
Days of '47 Rodeo

TRIVIA: How well do you know your rodeo? Take this quiz before you go to the Days of ’47!

The Utah Days of ’47 Rodeo presented by Zions Bank is a one-of-a-kind Gold Medal Rodeo being held July 20-23, 25 at 7:30 PM. The Days of ’47 Rodeo How well do you know your rodeo trivia? Take the quiz to test your know-all before heading out to the Days of ’47 Rodeo at the […]
cyber security through multi factor authentication setup...
Les Olson IT

How multi factor authentication setup helps companies stay safe

Multi factor authentication (MFA) setup is an important security measure that every company should implement for their workers. It’s also wise to install it for your personal and home accounts.
Lighting Design

Check out these stunning lamps with stained glass shades

Lamps with stained glass shades are statement pieces that are more than simply aesthetic. They also meet a functional requirement: to light up a room.
Address Bar of internet browser shows internet access...

Utah voters 50+ support increased access to Internet

The AARP surveyed Utah voters aged 50 plus about internet access and if they support the expansion of broadband, especially in rural areas currently lacking it.
Draining your rights? KSL Investigates insurance settlement agreements