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LAKE GEORGE---Victims and families of the victims of the tour boat Ethan Allen which capsized in Lake George last October have been told by the attorney for the boat’s owner that the company can’t help pay for funeral and hospitalization expenses because its insurance company refuses to pay.
The 38-foot Ethan Allen was carrying 47 passengers when it sank in 70 feet of water, killing 20 of the senior citizens aboard.
Survivors and victims’s families who filed claims with Shoreline Cruises Inc. of Lake George, the boat’s owner, received a letter in January from lawyer Michael Allweiss of St. Petersburg, Fla., explaining the insurance situation. ‘In the meantime, there is very little we can do on your behalf”, Shoreline’s attorney said. “Thank you for your patience and please accept our deepest sympathies for your loss”.
James Quirk, Shoreline’s owner, says he believed the company was covered by a $2 million insurance policy with Global Property Owners Association located in Miami.
But while Quirk says he has marine liability insurance, Charles H. Wegman, a agent for Global, says he doesn’t and that the policy that Quirk paid nearly $15,000 in premiums for only covered the company’s boats while they were on dry land from May to October. Global says Quirk has only a general liability policy because Quirk refused to buy maritime insurance but Quirk disagrees and has paperwork which appears to support his contention.
Global Property Owners Association is not registered to sell insurance in Florida and Wegman is not a licensed insurance agent in Florida or New York.
According to a spokesman from Florida’s Department of Financial Services which regulates the state’s insurance industry, an investigation of Global in 2004 showed that they were an unauthorized entity.
“They were possibly operating out of Florida, we can’t say for sure, but they didn’t commit any offense against Florida consumers or insure anyone in Florida that we’re aware of”, a spokesman for the DFS office told The North Country Gazette Thursday.
He said the company base was “generally in Texas”. Although it’s possible they may have been located in Florida at one point, he said GPOA has never been registered to sell insurance in Florida.
An insurance company in Florida must obtain a certificate of authority to operate their business in the state. He said that if the company was operating in Florida, they were illegally operating but based on the DFS investigation, GPOA’s policies and what they were insuring was heavily based in Texas.
In response to questions about Wegman, the DFS spokesman said their office has been unable to “track him down”.
According to the files of the Texas Department of Insurance, a license was issued to Charles Hedlund Wegman in June, 2005 to sell property and casualty insurance in Texas, the license to expire in 2007. His address is listed as Houston.
New York State’s Department of Insurance has also opened an investigation in Global and the policy which was sold to Shoreline Cruises.
According to Michael Barry, a spokesman for New York’s Insurance Department, while confirming that an investigation has been initiated, it hasn’t yet been determined exactly what Shoreline’s policy covers.
There is no requirement in New York State for vessels to have liability insurance, a situation that legislators say that they will be addressing in the next session.
It appears as though a case of insurance fraud may be involved and James Quiggle, spokesman for the Coalition Against Insurance Fraud in Washington, D.C., says that “this is a perfect time for crooks to swoop in and try to con vulnerable small businesses into buying affordable coverage they’re having a difficult time finding on the legitimate market”.
He said that some scams involve agents who sell bonafide policies and pocket the premiums or agents who issue fake policies with names which are intentionally deceptively similar to well-known insurers.
Quirk reportedly found GPOA on the internet and through other “research”. According to the policy, the insurance was written with United ReInsurance Group Ltd., in the United Kingdom. United is reportedly not licensed to sell insurance in New York State either.
Although neither Global of ReInsurance Group Ltd. are licensed to sell insurance in New York State, according to Barry, it wouldn’t be illegal for them to sell insurance in the state and wouldn’t affect the validity of the insurance.
According to the Detroit Free Press, Global Property Owners Association had a Miami office where businesses pay a monthly fee for calls to be answered and mail to be collected.
A check of business registrations in Florida shows that Global Property Owners Association Inc. filed to do business in Florida in June, 2003, with a mailing address in Miami. Robert S. Mills of Bonita Springs was listed as the registered agent and president of the corporation. The name and address of the “incorporator was listed at Stan Janczyk of Dallas, Texas. Neither man could be contacted.
The corporation is listed as inactive, having filed administrative dissolution in October, 2004.
Detroit Free Press has reported that the principals said to be involved with Global have a history of fraud and some reports have indicated that the company is not licensed to sell insurance anywhere in the U.S.
Ed Salazar, an attorney for the Texas Department of Insurance, has said that in all likelihood, the insurance policy issued to Quirk and Shoreline by Global was a scam. According to Salazar, the Texas insurance department has been investigating Global since 2003, a year before Florida began its investigation.
The Texas investigation focused on an alleged scheme by Global to sell fraudulent insurance polices to nursing homes and real estate owners in Texas. An order to cease and desist was filed against the company by the Texas insurance commissioner in 2003 but Salazar said the company changed its name and began selling insurance again which is apparently when it filed its corporate status in Florida with a Miami mailing address.
2-23-06
© 2005 North
Country Gazette
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