Insurer Reports Sandy Flood Claims Resolving Quickly

A bulletin by the National Flood Insurance Program helped spur quicker processing of Sandy flood-related claims.

Prior to the bulletin, claims were adjusted according to the policy and guidelines established by the Federal Emergency Management Agency (FEMA), according to Jeff Moore, vice president of claims for Fla.-based Wright Flood, a federal flood insurance and excess flood provider.

“It means a signed proof of loss is required on all claims, except on claims under $75,000 when the insured co-signed the report. The policy requires the insured must follow proof of loss within 60 days from the day of the loss,” Moore said.

Bulletin W 12092a granted a conditional and partial waiver of the general conditions of the policy, Moore explained.

“It allowed…Wright flood to pay a loss based on the adjuster’s report rather than a signed proof of loss. It also stated that the 60 day time limit in the general conditions would not apply. Instead, the amount of time was extended from 60 days to one year,” he said.

Moore said that if the payment that resulted from the expedited process is in dispute, the insured has up to one year to submit a proof of loss to support their disputed or supplemental claim.

The expedited process applies to Sandy only and will not apply to any future storms, though future bulletins may be issued. Future bulletins may be modified to correct any missteps taken on earlier storms, Moore said.

“FEMA and the National Flood Insurance Program generally treat each storm differently. In this case, this waiver set forth in the bulletin was applicable to all the states affected by Sandy,” said Moore.

He said that a similar bulletin was put out for Hurricane Katrina. It extended the deadline for filing a proof of loss to one year and waived the initial filing of it in order to get payment. That bulletin expired with the deadline set forth at the one year anniversary.

The intent of the most recent bulletin was to increase claim closures quickly.

“This [bulletin] allowed quicker advance payments. It relieved our concerns about advancing money without signed documentation,” he said.

Because the proof of loss deadline was extended to one year after the date of loss, Moore expects to see a higher reopen rate.

As of Monday, January 28, 90 days after Sandy hit the eastern seaboard, Wright Flood reported it closed more than 10,000 claims.

“That’s 52 percent of our reported claims. We’ve issued close to $500,0000 in claim payments. We’re currently processing claims and issuing payments on an average of three days after we receive them,” said Moore.

The company expects to see a high number of supplemental claims.

“We anticipate there’ll be a significant number of supplements just due to the increase in pricing due to the lack of availability of heating and air conditioning equipment, and the labor to install it,” Moore said.

According to H. Neal Conolly, president of Wright Flood, of the approximately 20,000 claims received, about 95 percent are from New York and New Jersey. He said there have been about 11,300 claims in New Jersey and 7.500 in New York.

“One interesting fact is that the claim values in New York seem to be on average higher in terms of the average settlement for payment. We’re not sure exactly why that is, but the average claim with a payment is over $37,000,” Conolly said. “In New York the average claim has been about $45,000 plus; in New Jersey it’s almost $34,000.”

Another coverage afforded under the policy is Increased Cost of Compliance (ICC).

“It usually is instituted after the direct loss claim is settled, or at least substantially estimated. It’s triggered by the community. The community determines your house is greater than 50 percent damaged, it will require you to bring your home into compliance with the local floodplain management laws. If they make that requirement of you, you’re eligible for up to $30,000 worth of coverage for the incremental cost to bring your house into compliance,” Moore said.

Because many homes on the eastern seaboard are older, Moore thinks there will be a substantial number of ICC claims.

“The insurance application for a building permit will trigger that activity by the local government,” Moore said. “When they apply for a building permit, according to the rules of participation in the national flood insurance program they have to evaluate whether that home is appropriate to stay where it is at the height it is.”

If you haveany questions about your coverage or the settlement of a flood claim, contact ACBI at 203-259-7580.

Reprinted from Claims

White House expected to seek billions in Sandy disaster aid


(Reuters) — The White House is expected in the coming days to send Congress a multibillion-dollar request to fund recovery from Superstorm Sandy, which caused an estimated $71 billion in damages in New York and New Jersey.

Congressional aides said there was no clear indication of the request’s size, but some said it would likely be at least $11 billion.

The Federal Emergency Management Agency’s disaster relief fund had access to about $7.8 billion as Sandy slammed the U.S. East Coast on Oct. 29, causing widespread destruction in coastal New York and New Jersey.

Lawmakers and analysts also said Congress will need to shore up the heavily indebted National Flood Insurance Program in the face of $12 billion in payouts resulting from Sandy, ranked as the second-worst disaster in U.S. history.

U.S. Senate Majority Leader Harry Reid, D-Nev., asked about the additional Sandy funding request, said: “Well, we can’t do anything with the disaster aid package until we get something from the White House, and I’m told that will be here as early as tomorrow or the next day.”

A White House official declined to provide any details about the administration’s plans. “We are working closely with our partners in the states and in Congress, but it’s premature to speculate on specific actions as we work to ensure the governors have the necessary support,” the official said.

Lawmakers from both parties have voiced support for providing additional disaster relief in Sandy’s wake, but a massive funding request from President Barack Obama could be disruptive to already tense negotiations over year-end tax hikes and automatic spending cuts.

If you have experienced a flood loss with Hurricane Sandy, ACBI can help you understand the complexities involved in making a claim either with NFIP or FEMA.  Call us today

Paid Sick Leave Equals Fewer Workers’ Comp Injuries

Employers looking to cut their workers’ comp costs may want to offer or expand their paid sick leave benefits. New research indicates workers who took paid time off when they were sick performed better and had fewer workplace injuries.

“Workers with access to paid sick leave were 28 percent less likely overall to suffer nonfatal occupational injuries than workers without access to paid sick leave,” reported the National Institute for Occupational Safety and Health. “Workers in high-risk occupations and industry sectors, such as construction, manufacturing, agriculture, and health care and social assistance, appeared to benefit most from paid sick leave.”

The study, Paid Sick Leave and Nonfatal Occupational Injuries, is published in the American Journal of Public Health. The authors surmised that safer operations and fewer injuries may result from fewer people working while sick. It also prevents the spread of contagious diseases.

The study examined information from the National Health Interview Survey of more than 38,000 working adults from 2005 to 2008. Those in the sample were asked whether they had access to paid sick leave through their main job or business and whether they had suffered any injury or poisoning that required medical consultation during the three months prior to the survey.

“Employers may benefit from improved productivity if paid sick leave helps reduce absenteeism, or unscheduled leave, and ‘presenteeism,’ or the problem of sick workers continuing to work while not fully productive,” the study says. “Sick or stressed workers who continue to work are likely to take medications, experience sleep problems or be fatigued. These factors can impair their ability to concentrate or make sound decisions, which can in turn increase their probability of suffering an additional illness or sustaining a workplace injury.”

Previous research has indicated paid sick leave is associated with shorter recovery times and reduced complications from minor health problems. Nevertheless, 43 percent of private sector workers in the U.S. reported having no access to paid sick leave, according to the study. While the Family and Medical Leave Act requires companies to provide up to 12 weeks of leave to eligible workers, that leave can be paid or unpaid. Only California and New Jersey have systems that provide workers with partial wage replacement, according to the study.

“We hope that our study along with previous research that supports our findings and conclusions will encourage policy makers and employers to consider the overall wellbeing of workers when making policy or funding decisions,” the report states. “Such a holistic approach would lead to more integrated development of programs that both prevent occupational injury and illness and improve other aspects of worker health.”

If you have questions about your Workers Comp Coverage and would like a no obligation analysis of your program, please contact ACBI at (203)259-7580.  With our unique Mod tool, we can help you understand what the mod is, how your loss history affects the mod and how the mod impacts your bottom line.  We are able to identify and analyze problem areas and develop targeted solutions to improve problem areas and reduce  premium and claims costs. 

From Risk & Insurance, Copyright 2012© LRP Publications

6 Tips to Avoid Post Storm Repair Scams

In the aftermath of every natural disaster comes a wave of man-made misfortune. Con artists flock to ravaged areas to take advantage of vulnerable people.

As cleanup after Superstorm Sandy gets under way, beware of people out to make a quick buck through bogus repair scams.

 Here are tips to avoid getting duped:

 1. Beware of unsolicited repair offers and other red flags.   As soon as the clouds lift, “storm chasers” descend on hard-hit neighborhoods, going door to door offering their services.

 “We use the slogan, ‘If you didn’t request it, reject it,'” says Frank Scafidi, a spokesman for the National Insurance Crime Bureau. “If someone comes knocking on your door, they could be legitimate, but they could be very illegitimate, too.”

Shady, unlicensed repair people do shoddy work, use inferior materials or collect money and leave without finishing the work. Don’t let the sense of urgency to start repairs tempt you to hire someone on the spot. Get a list of recommended licensed contractors from people you trust.

 Other red flags:

  • Contractors who claim to work for the government. The Federal Emergency Management Agency doesn’t endorse contractors or loan companies.
  • Repair people who don’t have a company street address, only a post office box, and don’t have business cards and company literature.
  • People who offer to inspect your property before you’ve checked them out. Some bogus contractors inflict or invent damage to make more money.
  • Contractors who have rundown equipment and an unprofessional appearance.
  • People who try to rush you into a decision.

2. Contact your home insurance company.  Don’t let a contractor elbow his way in between you and your insurance company, advises the Coalition Against Insurance Fraud. Distrust contractors who say they’ll work on your behalf with your insurance company to get more money for the claim or to pay the deductible.

Work directly with ACBI, or your own insurance agent, to handle the claim. Besides helping you understand your coverage, the insurance company can point you toward reputable contractors.

3. Get at least three estimates for repair work.  Compare the bids, and check whether complaints have been filed against the contractors with the Better Business Bureau, the PCI says.

4. Check contractor licensing, insurance and references.  Verify that the contractor is properly insured and licensed. Contact your state or local licensing agencies. Ask the contractor for a list of references, and call them.

5. Get everything in writing.  A contract for the work should state everything the contractor will do, including labor and materials prices, scheduling and cleanup procedures, the PCI says. Don’t sign anything with blank spaces, which a shady contractor could fill in later.

6. Never pay for a lot of work upfront.  Most contractors will want a reasonable down payment, the PCI says, but don’t pay in full until the work is completed and inspected, and don’t hand over any money until the contract has been signed. AARP New York says deposits or upfront fees should not total more than 25% of the estimate, and you should pay them only after materials reach your home and work begins.

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