Urges U.S. Department of Justice to investigate certain claims handling practices related to Superstorm Sandy flood insurance claims.
Impact
The resolution aims to bring accountability to the insurance industry, particularly concerning claims handling practices that may constitute fraud. By calling for an investigation, SCR94 seeks to address specific grievances raised by homeowners who feel their claims were unfairly denied. The broader implications could potentially lead to legal repercussions for insurers found to be engaging in deceptive practices, thereby affecting regulatory frameworks governing flood insurance and the responsibilities of insurance companies under the National Flood Insurance Program.
Summary
SCR94 is a Senate Concurrent Resolution from New Jersey that urges the U.S. Department of Justice to investigate the claims handling practices of insurance companies related to flood insurance claims arising from Superstorm Sandy. The resolution highlights ongoing issues that homeowners have faced, including delays and alleged improper handling of claims by insurers. These practices reportedly violate the fiduciary duty insurers have to act in the best interest of the insured. Homeowners who paid for flood insurance are counting on these policies to cover losses from the devastating storm, which adds urgency to the situation.
Contention
One notable point of contention raised in the resolution is the allegation that insurance companies have been secretly altering engineering reports to deny coverage, as referenced in a specific court case, Raimey v. Wright National Flood Insurance Co. These dubious practices are reported to have occurred in potentially hundreds of claims, suggesting systemic issues within the claims handling processes of flood insurance providers. As similar accusations are being made against insurers in New Jersey, the urgency for investigation emphasizes the need for consumer protection in the insurance market.
Requires DCA to resume Reconstruction, Rehabilitation, Elevation and Mitigation program with remaining funds for unmet recovery and rebuilding needs for Superstorm Sandy-impacted homeowners.