Whistleblower helps build case against insurance provider in Hurricane Katrina case

By Hubert Vigilla

Published on March 23, 2006

Scruggs told The Associated Press that the whistleblower provided him with copies of internal documents from an insurance company. These documents were prepared by engineers hired by an insurance provider to inspect hurricane-damaged homes. According to Scruggs, the documents indicate that the insurance company pressured engineers to alter their conclusions in order to deny claims.

Scruggs did not disclose the identity of the whistleblower nor did he identify the whistleblower's employer.

Scruggs and a legal team are representing more than 4,000 policyholders whose homes were damaged by Katrina. Among the clients represented is Mississippi Senator Trent Lott, whose home in Pascagoula was destroyed during the hurricane.

Robert Hartwig, chief economist for the Insurance Information Institute, believes that Scruggs' allegations of misconduct are not fair or accurate depictions of the insurance industry's practices concerning Hurricane Katrina claims in Mississippi. According to the state's top insurance providers, they have settled 82 percent to 96 percent of their policyholders' claims.

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