Circuit Court Grants WVIF's Motion for Injunctive Relief

The Circuit Court of Cabell County granted the West Virginia Insurance Federation's Motion for Injunctive Relief on Thursday, July 30. The Court's Order, which was agreed to by the parties, enjoins enforcement of the City of Huntington's Ordinance. The Ordinance would have forced insurance companies to withhold $2,000 of every $15,000 of insurance proceeds payable to a policyholder following a total fire loss within the City. The captured payment would have been held in escrow by the City and not released until all debris from a fire loss had been cleared from the property.

The Ordinance also allowed the City to retain policyholders' insurance proceeds to pay for any delinquent taxes or fees the property owner may have owed to the City. "Insurance benefits are not designed or intended to pay delinquent city fees or taxes," said Jill Bentz, President of the West Virginia Insurance Federation. "Consumers do not pay insurance premiums for this purpose."

The Insurance Federation's Motion, which the Court granted, asserted that the Ordinance was inconsistent with West Virginia state law, rendering it impossible for insurance companies to comply with both the Ordinance and state law.

"This Injunction is a big win for insurance companies and Huntington's insurance consumers," Bentz said.

The Order is retroactive to July 1, 2009, the effective date of the Ordinance.

>>> View the Court's Order