MAPFRE files lawsuit over Hurricane María insurance dispute
The insurer seeks $800,000 in damages.
Puerto Rico-based insurer MAPFRE PRAICO Insurance Co. has filed a lawsuit in the U.S. District Court for the District of Puerto Rico against unlicensed public adjusters for alleged negligence and misrepresentation in handling Hurricane María claims.
The lawsuit, which was filed on Dec. 4, seeks more than $800,000 in compensatory damages and could have broad implications for insurance practices on the island.
The defendants include Edward C. Reynolds, 411 Claims PR LLC and 411 Claims LLC, along with unnamed parties. According to the complaint, Reynolds and his associates misrepresented their credentials and operated without valid public adjuster licenses in Puerto Rico.
MAPFRE alleges they misled the Puerto Rico Highways and Transportation Authority (HTA) into hiring them to manage claims following the 2017 hurricane.
The lawsuit claims the defendants submitted inflated claims totaling more than $180 million, without proper investigation. These estimates allegedly included damages to bridges, traffic lights and other infrastructure, some of which were pre-existing issues unrelated to the hurricane.
One claim, for nearly $1 million in pre-existing bridge damage, had already been deemed ineligible by federal authorities, according to the complaint.
MAPFRE argues that these actions delayed resolution of claims and forced the insurer to incur significant legal and investigative costs. The HTA ultimately settled with MAPFRE for nearly $10.3 million in November 2023, far below the $47.9 million policy limit sought by the defendants.
In July 2023, the Puerto Rico insurance commissioner sanctioned Reynolds and 411 Claims PR LLC for fraudulent misrepresentation of their licensing credentials, barring them from engaging in insurance-related work on the island.
The lawsuit further asserts that contracts with unlicensed public adjusters are null and void under Puerto Rico law.
MAPFRE claims the defendants’ negligence caused the insurer to waste resources addressing exaggerated claims. The case, presided over by Judge Jay A. García-Gregory, underscores the risks posed by unlicensed adjusters and notes the importance of credential verification in post-disaster claims.
The outcome of this case could establish a precedent for holding unlicensed practitioners accountable and promoting transparency in Puerto Rico’s insurance industry.
