Flood Insurance and Class Action Lawsuits: who benefits?
After spending some time last year negotiating flood insurance premiums with my insurance company my eye was attracted to this article:Bank of America settles Flood Insurance Lawsuit
Two things struck me about this article. First, of course, that BofA should have been forcing people to maintain excessive amounts of coverage. That probably comes as little surprise to most people, me included.
The second thing is the economics of the settlement. Out of the total award of $31 million, the settlement administrator gets $660,000, while the 359,320 members of the class action share $21.82 million. Sounds like a lot of money, but that is just 60 dollars and 73 cents per member. And for negotiating this magnificent settlement how much do the lawyers get? Want to guess? The answer is $7.7 million – yep, $7,700,000. And those on behalf of whom they have worked so diligently get $60.73 each.
Tort reform anybody?
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty
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