Investigators from the New York state attorney general's office remove boxes of documents seized during an investigation into insurance fraud related to Superstorm Sandy claims. Frank Eltman/Associated Press
FEMA to Reopen Superstorm Sandy Claims in Light of Fraud
Senators from New York and New Jersey applaud the decision to probe insurance companies.
The Federal Emergency Management Agency will reopen some 144,000 claims filed by victims of Superstorm Sandy in 2012 in light of recent news reports of insurance company fraud under the National Flood Insurance Program.
FEMA also confirmed to Government Executive reports that the head of the flood program, David Miller, resigned last week.
Sen. Robert Menendez, D-N.J., on Wednesday announced that he and three other senators from his state and New York met with FEMA Administrator Craig Fugate on recent reforms to compensate victims who claimed the original damage assessments to their homes were altered to lower settlement payments—the subject of a recent report on CBS News’ “60 Minutes.”
“This is a significant turnaround for the thousands of Sandy survivors who have been victimized not only by the storm, but by FEMA, insurance companies and their subcontractors who systemically lowballed claims,” Menendez said. “I am pleased FEMA has admitted there are big problems and has committed to fixing them. I intend to hold their feet to the fire every step of the way to ensure Sandy survivors receive the fair treatment they deserve.”
Sen. Cory Booker, D-N.J., added, “I am committed to working with my colleagues to hold FEMA accountable. This is about transparency, it’s about accountability, and it’s about justice for our constituents.”
Sen. Kirsten Gillebrand, D-N.Y., said she was pleased also that the New York State Attorney General continues an investigation into the alleged insurance company doctoring of damage assessments.
In addition to the 144,000 claims being reopened, 2,200 others are in litigation, but FEMA says it will include those cases in any corrective actions.
The senators reported that FEMA will also take action to discourage reliance on engineering reports on home damage that rely on industry peer review. And the agency will:
- Develop a process for reopening and reviewing claims from all Sandy victims who are non-litigants but believe their claims were unjustly denied;
- Guarantee claimants receive access to all engineering reports;
- Contact by mail all Sandy claimants to make them aware of the new process and opportunity for review;
- Begin Sandy Task Force during the week of April 13 to begin evaluation of the program and focus on reforms; and
- Make personnel changes at senior levels of the National Flood Insurance Program.
Neither FEMA nor the senators estimated the cost of the look-back at the claims, but a private consulted interviewed by National Public Radio estimated it at $4 billion.