Attorney: Fla. insurance on Chinese drywall axed

MIAMI -- Florida’s public insurance company has again reversed course on its coverage for homes with tainted Chinese drywall, telling some owners it will suspend such policies, an attorney for the victims said Monday.

Attorney David Durkee, who represents about 300 people with homes containing the defective materials, said Citizens Property Insurance Corp., a state-backed insurer of last resort, has begun issuing notices to alert policy holders their coverage will be dropped.

Citizens did not respond to a phone message and e-mail Monday. If the insurer is issuing such notices en masse, it would mark a return to its earlier attempt to not cover homes with Chinese drywall.

“When clients who are already victims are getting letters that are threatening to take away their homeowners insurance, it’s like pouring gasoline on the fire,” Durkee said.

Among those receiving a letter from Citizens was James Ivory, who bought a three-bedroom Punta Gorda retirement home with his wife in 2009, but was unable to live there more than two months because of the drywall. They began suffering headaches, dizziness, nosebleeds and rashes and noticed a rotten-egg smell, among other clues.

In October 2009, Citizens informed the Ivorys it would drop their policy over the drywall issue, but then backpedaled after bad publicity over the decision. Now, a letter dated Jan. 11 informs them Citizens intends to drop their coverage in March.

“You try to do everything, you try to save your money to have a retirement home in Florida and now I can’t even live in it,” said Ivory, a 68-year-old retired mechanic. “It’s tearing me up.”

Thousands of homeowners nationwide who bought houses built with the defective materials are finding their lives in limbo as hundreds of lawsuits work through the courts. Insurers are in a quandary over the drywall issue. Some say they can’t continue providing insurance until the problem is fixed, something some say could cost homeowners more than they paid for their homes.