Add Bobby von Merta to the long list of Bay Area viewers who are complaining to the NBC Bay Area Responds team about losing their property insurance coverage.
Von Merta says his policy problems are a puzzling poster child for why California faces an insurance crisis.
He owns a dozen apartments in Newark.
“We just call it Sycamore apartments,” he said. “I built them in 1987 and I’ve owned them that long.”
Getting insurance at the apartments has been easy, until now he said. Von Merta said he’s unable to get insurance because a former tenant hustled him and his insurance companies during the pandemic.
“This is extortion,” he said.
Von Merta claims the tenant moved out quietly but then sued him for at least $100,000, alleging he rented her an “uninhabitable” apartment.
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“She never complained about the habitability of her apartment, ever,” von Merta said. “If she had [complained], I would have been on it immediately.”
Dave Skidore, a resident of the small apartment complex since 2017, said he never heard his neighbor complain about her apartment being uninhabitable.
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"I was actually really surprised about any complaint of habitation," Skidore said.
Von Merta says his insurance companies got involved and ordered an independent review. In an expert report reviewed by NBC Bay Area, it said the tenant’s complaint was “almost entirely devoid of facts.”
“I’m no slumlord,” von Merta said. “I take care of my places.”
Von Merta expected his insurance companies to fight. However, they did something he did not expect.
“They paid out $150,000,” von Merta said.
He said his two insurers each paid the tenant $75,000 to settle the case. One company declined to speak to NBC Bay Area and the other did not respond to the request for comment.
Von Merta said representatives did talk with him and told him it was just cheaper to settle for $150,00 rather than litigate and rack up legal fees. He said he was -- and still is -- furious at his insurance companies.
“It was all fraud,” he said. “They’re not really suffering the consequences. people who are buying insurance are.”
He’s not the only one saying that.
“It’s a huge problem,” said Michelle Rafeld with the Coalition Against Insurance Fraud, a group of government fraud investigators, insurance companies, and academics. The group calculates that fraud costs insurance carriers more than $300 Billion a year, which they pass on to us.
“An individual, in the course of their lifetime, stands to lose $73-thousand dollars to insurance fraud in the form of higher premiums,” Rafeld said.
She said consumers should report any suspected fraud and contact the appropriate authorities.
That’s exactly what von Merta did at the local, state and federal level.
“I told them this was fraud right off the bat,” he said.
But no one has pursued his case. Von Merta says everyone’s paying a little more for insurance because his insurance companies caved.
“They created their own insurance crisis,” he said.
Von Merta said he lost his coverage over this episode, but hasn’t lost his appetite for accountability. He’s still hungry for law enforcement to take a second look at his chapter of California’s insurance crisis.
“I’m ready, any time,” he said. “Take these people to task for what they did."
