Schumer Blasts FEMA for Slowed Sandy Insurance Claim Processing
U.S. Senator Charles Schumer called on FEMA to immediately speed up the processing of flood insurance claims through the National Flood Insurance Program for homeowners impacted by Superstorm Sandy.
More than 100 days since the storm struck, only 52 percent of New Yorkers’ flood claims have been fully processed, greatly slowing down, or in some cases preventing, the rebuilding process.
The NFIP is run by FEMA, but largely administered by a network of private insurance companies who sell and service them and independent claims adjusters hired by FEMA.
These companies take on no additional risk by participating in the NFIP – their expenses are reimbursed by FEMA – and they profit from generous fees that can add up to as much as one-third or two-thirds of all premiums collected on NFIP policies in a given year.
Schumer said that FEMA must immediately require far better performance and quicker payouts from these companies, and that FEMA should consider requiring them to hire more claims adjusters and inspectors. FEMA should penalize them by deducting from their fees, and if a company is repeatedly late, then FEMA needs to consider ending their participation in the program, Schumer said.