Closing Sandy Claims

It’s been more than three months since Superstorm Sandy wrought havoc across the East Coast last fall. And since then, the property/casualty insurance industry has stepped up to deliver its promise to customers and assist them in rebuilding their lives.

Last December, the New York state government began publishing “reports cards” on 24 insurers that make up the most of the insurance market in New York regions that were impacted by Sandy. The latest report cards, as of Feb. 8, show that among the 388,906 Sandy-related claims, 266,618 have been closed with payment and 67,497 claims have been closed without payment – which indicate that 86 percent of the insurers’ Sandy claims have been resolved. The reports say the information includes consumer policies such as homeowners’ and auto insurance, as well as business policies such as business interruption insurance.

The report cards also show that New York’s Department of Financial Services received 2,401 complaints out of 388,906 Sandy-related claims, at a claims complaint rate of 0.617 percent.

Similarly, in New Jersey, the majority of Sandy claims have also been resolved. In his speech on Feb. 5, New Jersey Gov. Chris Christie said that some 430,000 Sandy-related personal and commercial claims – excluding National Flood Insurance Program claims – have been made in the state. “The good news is, 78 percent of those claims – 333,000 – have been resolved. Either a settlement’s being paid or the file’s being closed,” Christie said.

But the famously outspoken governor said he was none too happy with the federal flood insurance claims process. “Including the federally regulated flood claims, approximately 495,000 claims have been filed related to Sandy. And 70 percent of those have been closed. You can see [the percentage of closed claims] gets smaller when I put the flood insurance in.”

“We are very unhappy as an administration with the way the federal government has administered the National Flood Insurance Program. It’s a disgrace,” Christie said. “The fact of the matters is I have been as patient as I am going to be…and now I am going to have to turn my special brand of love and affection onto the National Flood Insurance Program.”

Gov. Christie said excessive paperwork and cumbersome procedural requirements of the NFIP may have contributed to sluggish resolution of claims. But the Federal Emergency Management Agency defended the program, stating that FEMA has already taken steps to speed up the process.

Also, FEMA’s new data suggests how fast or slow a flood claim gets processed may also be linked to which insurer is handling the claim – with some companies appearing to process their claims much quicker than others. (We have additional stories on FEMA’s response and flood claims data on pages E8 and E16.) What report card would you give to the federal government for its handling of the NFIP?

Topics New York Claims Flood