Over 90% of New Jersey/New York Sandy Claims Settled

Insurance regulators in New Jersey and New York — the two states hardest-hit by Superstorm Sandy — reported that as of April 19, insurers have settled 93 percent of the claims they received in the wake of Sandy, according to the Insurance Information Institute.

More than half of the 1.5 million claims for Sandy-related damage to homes, vehicles, boats and businesses were filed in either New Jersey or New York. The others were filed in a dozen other states as well as the District of Columbia.

The I.I.I. said that insurance companies will pay an estimated $18.8 billion in claims to policyholders, making Sandy the third-costliest storm in U.S. history, as defined by claims payouts.

Hurricane Katrina in 2005 ($48.7 billion in claims payout in 2012 dollars) and Hurricane Andrew in 1992 ($25.6 billion in claims payout in 2012 dollars) were larger insurance events.

The estimates of claims payments do not include claims for flood damage insured under the National Flood Insurance Program (NFIP).

The damage caused by Sandy generated nearly 1.1 million claims from homeowners, a quarter million from vehicle owners and more than 200,000 claims from business owners. Business claims accounted for only 13 percent of all those filed after Sandy yet they will in the end account for 48 percent of all the Sandy claim dollars paid, an I.I.I. analysis found. The reason is that the value of commercial property is often higher than that of home properties. Also, business interruption coverage reimburses a business owner for lost profits and continuing fixed expenses.

New York and New Jersey also had the largest Sandy-caused flood damages. Flood insurance is usually not covered under a standard homeowners or business owners policy. The percentage of homes and businesses situated on the Atlantic Seaboard, with flood insurance policies prior to Sandy, was comparatively low as compared to other hurricane-prone states, such as Louisiana and Florida.

Flood damage to vehicles is typically covered under the optional comprehensive portion of standard auto policies.

Topics New York Claims Flood New Jersey