The New York state Department of Financial Services is one of the latest authorities to join the growing list of government offices investigating allegations of fraud surrounding insurance companies illegally altering structural engineering reports in an effort to unfairly deny or minimize Sandy victims flood claims.
The NY Department of Financial Services oversees the banking and insurance industries in New York state, where many home and business owners were devastated by 2012 Hurricane. Sadly, it seems that as many as 10,000 property owners were victimized twice, once by Sandy, and again by unscrupulous insurance company representatives, who cheated them out of their settlements by changing the structural engineering reports written by their engineering contractors.
When a report suggested a claim was covered and the carrier had to pay to rebuild the property, the language was switched to say that other factors, like long-term settlement, caused the loss, and the claims were promptly denied.
Benjamin Lawsky, Superintendent of the New York state Department of Financial Services,is conducting an investigation into the alleged altering of engineering reports following Hurricane Sandy
Similar investigations are already underway by the Inspector General of the Department of Homeland Security and the New York Attorney General’s office.
Last month, four senators from NY & NJ called for oversight hearings into the fraud allegations. And it was reported last week the Senate Banking Committee has set up an investigative team to examine Sandy related fraud issues.
These are criminal investigations.
The discovery of these fraudulent practices has many questioning just who decided these engineering reports be manipulated in the first place. One has to realize the chain of command in the Flood insurance industry. It all starts with FEMA, through the NFIP, or National Flood Insurance Program. Then trickles down to the WYO, or “write your own” flood insurance companies, well-known carriers like Travelers and Hartford, or lesser known companies like Wright National Flood Insurance. Essentially, the WYO’s administrate the policies and handle claims for the NFIP, but all of the claim payments come from the federal government.
These federal and state probes will almost certainly give us the answers on who is ultimately responsible for what appears to be a very large scale fraud practice, which affected thousands of Hurricane sandy flood victims.
Don’t be victimized twice, consult with the professionals at Richard Green and Son Public Adjusters following any property loss. Remember, your insurance company protects you from disaster and we protect you from your insurance company!