Unless you have been consciously trying to avoid it, you cannot help but know that is going on regarding Hurricane Sandy and the engineering fraud that seems to have run rampant in the claims handling process. FEMA has not stepped into the breach to resolve all of the litigation that has come about as a result of the fraud committed against flood insurance policyholders.
Early this morning, I received a telephone call from a public adjuster I hold in high regard. He asked me about a gentleman that suffered flood damage from Hurricane Sandy, was underpaid, but who believed the engineering report he was provided by the insurance carrier was truthful and that he did not have coverage for the structural damage to his home. Because of the recent recession, the gentleman’s home was worth less than he owed on it and, without the money to make the repairs, he made the difficult decision to let his home be foreclosed upon and to start over at 70 years old. The time for him to file a Proof of Loss or a lawsuit has passed. Unfortunately, I have heard several of these stories. There are hundreds, if not thousands, who suffered similarly. Likewise, there are still more who may not have lost their home, but who were not properly paid on their policies and did not know they had recourse to collect what was rightfully owed.
What happens to these people? Under what I have seen thus far from FEMA’s response to the altered engineering reports – not much. FEMA seems interested in cleaning up the public relations nightmare that the altered engineering reports have created by resolving all of the pending litigation. Nothing has yet been said about the people who did not pursue litigation because they believed what the insurance carriers were telling them was true. In order to truly right the wrongs committed by the WYO carries in the wake of Hurricane Sandy, FEMA must audit every single flood claim, whether or not there has been a lawsuit filed.
