Months After Sandy, Insurance Still Not an Answer
Residents of Union Beach met with Rep. Frank Pallone on Tuesday to air grievances about insurance.
Randall Kidd’s story isn’t unique.
A Union Beach resident, he’s faithfully paid into the National Flood Insurance Program for years, insuring his home against the kind of flood damage caused by Hurricane Sandy with a $217,000 policy he hoped would make him whole.
After his home was destroyed by the late October storm, Kidd set about filling out the appropriate paperwork, meeting with adjusters who came in from out of state and waiting for the check to arrive so he could start to work. Finally, the check did come, but for $89,000, less than half of what contractors have told him it will cost to rebuild his home.
In a crowded conference room at Union Beach’s municipal building, Kidd and other area residents met to find an answer, or at least relate tales to U.S. Rep. Frank Pallone, D-6, of their personal on-going sagas with the insurance. Whether residents have yet to receive insurance payouts, have been unable to reach representatives from the flood insurance program, or, like Kidd, have gotten checks substantially less than what they believe they were promised, there’s a consensus: the flood insurance program just isn’t working for Sandy’s victims.
“The reason I think this is outrageous, and I really think that the problems that we have are unacceptable, (is) because people have been paying into this flood insurance program for years,” Pallone said. “The reason you pay into it is that if there’s a hurricane or some other kind of natural disaster, you expect to be paid.
“All of a sudden, now, when we need the money, we don’t get the claims met.”
According to recent data from the State’s Department of Banking and Insurance, of those who have filed homeowners claims with their respective insurance companies, about 80 percent have been resolved. When it comes to flood insurance claims, however, only about 30 percent have been resolved.
A majority of homeowners insurance claims have been resolved in a positive fashion following Sandy, Gov. Chris Christie said at a recent press conference. Flood insurance claims, not so much. Banking and Insurance tracks complaints that come in regarding all types of insurance. For every one complaint the department has received about a homeowners claim not being satisfied after the storm, three have come in for flood insurance.
A significant concern with flood insurance, in addition to the poor payouts some residents have gotten, is the overwhelming delay that’s plagued the program since the storm. According to Pallone, many adjusters are responsible for upwards of 150 separate claims. The burden has grown so large that the Federal Emergency Management Agency (FEMA), which manages the flood insurance program, has eliminated preexisting response deadlines, leaving the process open and residents to wait an undetermined amount of time for resolution.
Kidd got his check, though he’ll likely have to appeal the amount. Susan Fouts in the same boat. Insured for the same $217,000, her check came in at $91,000, and, like Kidd’s, won’t be nearly enough to rebuild. Roughly $100,000 less than she and her husband need to build back to where they were, the insurance claim, essentially, is worthless.
Some still have yet to reach that point, mired in their own insurance limbo somewhere else down the line.
“I think the game is, after a while you’re going to get so frustrated you just walk away,” Union Beach resident Lowell Carhart said about the process he and his wife Rose have gone through just to contact an adjuster.
Though not an answer to the flood insurance problem, one both Pallone and Christie have vowed to have answered, funding options will become available shortly that will help residents struggling to cover the reconstruction shortfall they’re currently facing. Called Community Development Block Grants, the competitive grants will help residents rebuild and raise their homes, should residents not qualify for Increased Cost of Compliance funding or if it’s not enough to cover the entire cost.
Funded by a portion of the more than $60 billion Hurricane Sandy Relief Bill passed by Congress in January, the grants are part of a $1.8 billion chunk allocated specifically for the rebuilding homes and small businesses. Depending on need, more aid could become available, Christie has said.
Pallone was quick to dispel rumors that popped up as he spoke about the grant program. Some residents said they’ve heard funding won’t be available for a year, maybe two. That’s not the case, Pallone promised. The Governor’s office, along with the U.S. Department of Housing and Urban Development, is meeting with mayors from municipalities throughout the state as early as next week to find out what the needs are of their respective towns.
Flood insurance needs to be dealt with, he said, but it won’t delay New Jersey’s ongoing rebuilding effort.
“If we don’t rebuild, people aren’t going to come back here, people are going to abandon their properties,” he said. “ We can’t allow that.”