2 years of fights with insurance ‘a nightmare,’ derecho-impacted Cedar Rapids homeowner says

CEDAR RAPIDS — Two years after the devastating effects of the 2020 derecho, the crack in the concrete foundation of Mark Sutton’s home still needs to be repaired, and the house still needs to be rewired. Damage to the siding has not been repaired, nor has the punctured siding or cracked door on his detached garage.

Sutton said it has been a non-stop battle over insurance — “a nightmare” — since the Aug. 10, 2020, storm barreled through.

“I’ve been living two years in a broken house and they don’t care. They just do not care at all,” said Sutton, of Cedar Rapids. “And they lie.”

Sutton is not alone. State insurance regulators have received 690 complaints over derecho-related insurance issues, according to a spokesman for the Iowa Insurance Division.

But there are likely many more still in the fight in different ways, said Greg Usher, a Cedar Rapids lawyer who has been working for many homeowners impacted by the derecho. Roughly 4,700 out of 225,000 derecho-related claims filed by policyholders in Iowa still remain open, according to the state insurance division.

“There are probably hundreds and hundreds” of homeowners like Sutton, Usher said. “And there’s probably hundreds and hundreds who have just given up entirely, thousands (more) who didn’t know that they could push for more or how to go about doing it, and dozens and dozens paying me to help them kind of fight back.”

The 2020 storm, which featured straight-line winds that surpassed 140 mph, covered 770 miles from South Dakota to Indiana over the course of 14 hours and caused $11.5 billion worth of damage to communities, farms and crops, according to the National Oceanic and Atmospheric Administration. Three deaths in Iowa were attributed to the storm.

For homeowners such as Sutton, the derecho wreaked devastation upon his home. But the two years since have done the same to him, he said, causing him significant stress and pain. He said over the two years, the insurance company has sent 16 desk adjusters and six field adjusters to his house.

“And we’re still fighting them,” Sutton said. “Every bill we have sent them, it’s, ‘Oh, that’s too expensive. We’re not paying that.’”

Sutton, a retired electrician, said he does not have the resources to hire an attorney. “Understand my frustration: I know I’m not going to get anywhere because I don’t have the money to fight (the insurance company). So how does that work?” he said. “It’s been a nightmare.”

Usher said the clients he works with — and many of the homeowners who cannot afford a lawyer — frequently face what he described as stall tactics by insurance companies.

“There’s a lot of, ‘Let’s see if we can run out the clock slowly, bite off little chunks (of claims paid out),’ but not anywhere near the whole thing that we need,” Usher said. “It’s kind of a, ‘Let’s force the insured into a pay to play situation.’ (Homeowners) either roll over and just take what they’re given and don’t fight for everything they’re entitled to because they don’t have the financial or emotional wherewithal to keep putting up the fight. Or, (insurance companies) say, ‘Alright, well, we have to make them earn it.’ So force them to pay for an appraisal, get an attorney involved along the way. … They’re going to force the insured homeowner and business owner to spend money.”

That, Usher says, creates a system where those with financial means can afford to take steps to make themselves — and their homes — whole, while those without are unable to do the same.

“The ones who have nice little set of reserves in cash sitting around to pay for those services usually get taken care of after putting up that fight,” Usher said. “But a lot of the people who, their house is the nicest thing they own, they don’t have a ton of cash reserves because they’ve already spent it making repairs or just living paycheck to paycheck. They don’t have that money sitting around to have somebody with expertise help them, and they’re the ones who probably most need the help because they can't afford to pay for the repairs out of their own pockets. … And there’s still a lot of them.”

Insurance companies have paid over $3.6 billion to settle the more than 225,000 claims, according to the state insurance division. The numbers are unprecedented, a division spokesman said. The total includes payments that resulted from consumer complaints, which have reached more than $1.1 million, according to the division.

Doug Ommen, commissioner of the Iowa Insurance Division, in a statement to The Gazette, encouraged homeowners to continue communicating with their insurers about both their claims and any challenges they face during the process. Ommen also noted Iowans who feel they are not getting what they were promised from their insurance policies can file a complaint with the Iowa Insurance Division.

“While both Iowans and insurers have worked very hard towards recovery from this catastrophic event and the vast majority of insurance claims from the 2020 derecho have been settled, there are some Iowans continuing to work through the process of completing repairs,” Ommen said. “Each claim is unique as to severity. Some properties more severely impacted by this storm may require additional time to complete. It’s important for those Iowa consumers to keep the lines of communication with their insurance carrier open and work through the issues that may be left in dispute.”

No insurance companies have pulled out of Iowa since the derecho, the state insurance division spokesman said. But some homeowners’ insurance was not renewed by their company after making derecho-related claims.

Sutton was one of them.

“Statistically, I’m high risk, and I got non-renewed,” Sutton said. “Beyond my control. Nothing I could do about it.”

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