Flood insurance generates more controversy in the US
Two Senators from New Jersey have taken issue with the National Flood Insurance Program. The program is typically the only place for homeowners to find flood protection in the United States, but the program has been beleaguered by financial problems for years. These financial issues hit a height in the wake of 2011’s Hurricane Sandy, which caused an estimated $68 billion in damage in several states along the eastern coast of the country.
Senators believes that federal insurance program may be avoiding paying claims for those affected by Hurricane Sandy
Senators Charles Schumer and Kirsten Gillibrand are calling for an investigation into the companies that provide coverage through the National Flood Insurance Program. The program serves as a way for companies to provide flood protection without being exposed to the significant risks involved in doing so. Floods can be an expensive problem, and many insurance companies are not willing to take the financial blow associated with the damage that these disasters can cause. Even backed by the National Flood Insurance Program, insurers may be taking unethical steps to mitigate their exposure to financial impact.
Hearing concerning the management of the National Flood Insurance Program may be called
The Senators have raised concerns regarding the way that the Federal Emergency Management Agency handles the flood insurance program. They have petitioned the Senate Committee on Banking, Housing, and Urban Affairs to hold an oversight hearing regarding the program and determine whether or not insurers are conducting fair business. Part of the issue has to do with delayed claims payments. Many homeowners are still waiting for their claims to be paid in full, while others have suggested that their claims were unjustly rejected.
FEMA is slow to investigate allegations of fraud
Officials with the Federal Emergency Management Agency have noted that they are aware of fraud allegations, some of which date back to early 2013. In a hearing held in July of 2014, these officials claimed that they would send any evidence of fraud they found to the inspector general, but any investigation into these allegations was not conducted until late in December of that year.
