In the wake of Hurricane Katrina, the National Flood Insurance Program will be modifying the way it settles claims to expedite the response to those policy-holders in storm-stricken areas under a new policy announced Tuesday by Acting Federal Flood Insurance Administrator David Maurstad.
“The National Flood Insurance Program (NFIP) is working closely with the insurance industry to speed the claims process and enable adjusters to help policyholders get settlements quickly,” Maurstad said. “For many Hurricane Katrina victims, the effort to rebuild their lives begins with filing a flood insurance claim.”
The NFIP is utilizing all available data on water depths, aerial imagery, and information from underwriting files, to determine properties where it is readily apparent that flood damage covered by the policy will exceed the amount of insurance purchased. It will be possible to pay the policy limits through dialogue with the insured and without waiting for a site visit to adjust the loss. This process may be used when homes have been washed off their foundations, affected for long periods by standing water, or when only pilings or a slab remain.
The NFIP has waived the usual requirement that the policyholder must submit a proof-of-loss and instead where the policyholder agrees, will rely on a report by the claims adjuster. The NFIP has urged insurance companies to provide advance checks of around $3,000 to policyholders who carry contents coverage.
Adjusters have been instructed to assist policyholders in developing a list of their contents and appliances damaged by flood waters. Serial and model numbers are not needed, and a list of contents by major grouping may be submitted, rather than a comprehensive list.
Policyholders without important insurance documents can contact the NFIP’s flood insurance hotline at 1-800-427-4661 to get their policy information. A listing of insurance company phone numbers, along with additional insurance information, is also available at http://www.fema.gov/press/2005/katrinainsurance.shtm.
Insurance experts are also on hand in most FEMA Disaster Recovery Centers to assist flood victims, in person, with the claims process. Flood insurance claims adjusters have been on the ground in Alabama, Florida and Mississippi assisting victims; and are now moving into many affected areas of Louisiana.
“Katrina is the largest flood disaster in our nation’s history, and it requires us to take a new look at how we process flood insurance claims,” said David Paulison, acting under secretary of Emergency Preparedness and Response and Acting FEMA director.
The NFIP has been in contact with the Insurance Commissioners of Louisiana, Mississippi and Alabama, and will continue to maintain close communications throughout the claims process.
“The citizens of Louisiana need a fair and speedy process as they rebuild their lives,” said Louisiana Insurance Commissioner J. Robert Wooley. “It is going to take everyone in private industry and in government working together to accomplish the difficult task before us.”
“Since the National Flood Insurance Program began in the late 1960’s and took over the flood insurance program, they have worked hard to expedite the assistance they offer to flood victims,” said Mississippi Insurance Commissioner George Dale. “Like many others in the aftermath of Katrina, they are adapting to a situation none have encountered before. I applaud their efforts to efficiently serve the Mississippi victims of Katrina. We will be working with NFIP and other government agencies in an effort to find relief for those not covered by an insurance company or NFIP.”
“Among the lessons our department learned from Hurricane Ivan was the need to work closely with the National Flood Insurance Program,” said Alabama Insurance Commissioner Walter Bell. “I am appreciative of the aggressive approach the program is taking in regards to claims from Katrina. As it appears that the flood losses from Katrina will be quite large, it is important that consumers have the process streamlined. We will continue to work closely with the NFIP to best serve Alabamians affected by flood.”
Federally backed flood insurance is available for residents living in and out of floodplains, through nearly 100 Write-Your-Own insurance companies in more than 20,000 participating communities nationwide. Communities participate in the National Flood Insurance Program by enforcing floodplain development standards. More than 4.6 million Americans carry flood insurance.
People in every state can visit http://www.FloodSmart.gov to learn more about their flooding risk and how to protect themselves.
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