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Thursday, May 28, 2015
Updated
Sandy victims fight back
Loophole in flood insurance raises homeowners’ ire
Anthony Rifilato/Herald
Long Beach residents Ron and Debbie Gialanze said that their insurance company denied their claims because of a loophole that is preventing many residents from rebuilding their homes.

Ron and Debbie Gialanze owned a ranch-style home on East Pine Street for 26 years, and raised two children there. When they finished paying the mortgage, they decided to continue paying for flood insurance — a little peace of mind, Debbie said, for residents of a barrier island.

But when Hurricane Sandy hit, it not only destroyed their home, but the flooding from Reynolds Channel damaged its foundation. The Gialanzes thought they would be made whole — after all, they had a $250,000 flood insurance policy with Fidelity.

To their dismay, the company refused to pay the full value of their policy, which would have allowed them to demolish the house and rebuild.

A loophole has raised the ire of the Gialanzes and thousands of other homeowners in New York and New Jersey who filed flood insurance claims but have been denied. A provision of the National Flood Insurance Program, which is managed by FEMA, states that property loss caused by earth movement — even if it is the direct result of flooding — is not covered.

The Gialanzes have been unable to return home since Oct. 28, when they evacuated. They were lucky, they said, to find a home to rent in Levittown, but they are worried that their housing assistance from the Federal Emergency Management Agency will soon run out.

“You figured all those years — and we never put a claim in, not even for Irene — that we’d be OK,” said Debbie. “Now, when we’re ready to collect on it so we can move forward, they’re like, ‘No, sorry.’ They’re not going to give us money for structural damage because of that loophole in our flood insurance policy saying that it’s earth movement.”

U.S. Sen. Kirsten Gillibrand is calling on FEMA to review its policy and reverse the denials, saying that denying the claims “pulls the rug out from underneath homeowners who are relying on their flood insurance policies to repair and rebuild their homes.”

“It is deeply troubling that damages caused by a storm of this magnitude are excluded from flood insurance policies,” Gillibrand said in a statement. “We must ensure that no bureaucratic fine print stands in the way of getting Sandy-impacted homeowners fully back on their feet.”

Rallying for change

A number of Sandy victims, including the Gialanzes, are planning a rally at the Theodore Roosevelt Executive and Legislative Building in Mineola on Aug. 29 to ask for support from their elected officials and to call on FEMA to change the policy. “Thousands of us have paid for flood policies, and we’re entitled to fair claims practices and payment of our policy limits in the event of a flood,” said organizer Michele Mittleman, a Freeport attorney who founded a Facebook page last month called Sandy Victims Fight FEMA.

Mittleman said she was denied full coverage for her home, which sustained extensive damage and was condemned. Her flood insurance coverage, also with Fidelity, totaled $180,000, and to date, she said, she has received just half of that. She was told that the home had a pre-existing settling condition, after Fidelity’s engineer’s report noted some cracks in the sidewalk in front of the house after the storm.

“It wasn’t until I went online and read through the policy — that’s when I discovered this earth movement exclusion,” Mittleman said.

She and others said they believe the clause is being improperly used by FEMA so it can avoid paying homeowners’ claims.

Mittleman hired her own engineer, who refuted Fidelity’s report. She submitted her own report in April, but in June, she said, FEMA made a determination that Fidelity was correct, and her claim was denied. “Many people are still waiting to hear from FEMA about their benefits,” she said, “and don’t know about this exclusion and that they may be denied.”

In a statement, FEMA spokesman Dan Watson said FEMA's top priority is to provide assistance to those in need as quickly as possible, "while also meeting our requirements under the law."

He said that FEMA works with its private sector, write-your-own insurance company partners who sell flood insurance under their own names and are responsible for the adjustment of their policy holders’ claims. Watson said that FEMA administers the National Flood Insurance Program at the direction of Congress. By law, he said, the Standard Flood Insurance Policy (SFIP) only covers direct physical loss to buildings by flooding.

Comments

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Seagull

Thanks for the info re aug 29th. Spread the word...its many families plight..different towns..diffrnt families..slightly different affects..the major problem being that nfip does not cover the direct natural topographical cause of the bulk. Of the resulting damage. Who can keep the ground from Slipping under their feet.?.it's like an aqua earthquake.

The comment I recieved from the insurance adjuster who came to inspect the damage initially was.'.the government will pay for it ' but it ain't necessarily so. katrina changed the whole insurance game..but our taxes & flood insurance rates here have always been astronomical..this just adds insult to injury when we are personally paying for damage we had no control over..

Thursday, August 15, 2013 | Report this
Sandeep

Only 50% of folks had flood insurance on the South Shore of LI of houses that got flood. This couple got $180K while while 50% of nieghbors with similar damage only got $31,900.

Now since flood does not cover earth movement they did not have insurance for that. I think it is great they are protesting FEMA pay them out for something they never insured against. They should go for it.

But unless they are also protesting to get earth movement covered for folks without flood insurance who also did not have earth movement coverage it is insult to injury. Wait till neighbor who got 150K less for same damage as this family finds out their taxes are going up to cover a pay out of even more. This protest should be for all. The folks who need the money the most are not invited to this party.

Also earth movement is tough to prove. Did you do a full inspection the day before Sandy of your foundation and take pictures and use a leveling tool? Unless you can prove day before foundation was fine hard to prove Sandy caused it.

For instance I inspected whole foundation for cracks day before Sandy, any crack I found I filled in with concrete. Guess what when I gutted basement under sheet rock I found more cracks and when I redid concrete floor in lower level guess what it was unlevel. Did Sandy cause it who knows.

Far Rockaway and Atlantic Beach NY put in new cement block bathrooms after sandy by boardwalk FEMA inspected. Guess what last weekend during inspection it was discovered settling took place and cement foundations have cracks and there are leaks. Stuff happens.

Also is this something that would be considered for NYS rising if so apply there. Also you can put in for this as a casualty loss on your taxes up to September 15, tor get a case worker from Red Cross or Catholic Charities and look for a grant.

If you did not have insurance over earth movement you did not have insurance, does not mean you wont be covered just look for other avenues.

Anyone with flood insurance is not a sandy victim. They were covered. If anything they are victims of their own misunderstanding of how flood insurance works, bureaucratic stupidity at NFIP or bad contractors. Not sandy.

Biggest victims I have met are I ran into a few elderly widowed ladies whose husbands was in charge of the money and back as far as Hurricane Gloria accepted some FEMA (once in a lifetime grants) and never got flood insurance. The widows were denied the FEMA grant of $31,900 and got nothing. Even more horrible I was talking to a women around 85 trying to see if I could find a grant for her and the neighbor with flood insurance comes to me and says that house is moldy I cant believe she lives there. He then ranted I should sue her for mold spores my house is all redone with my insurance money and she is holding down my property value. Wow.

BTW bringing engineers, town of hempsted buildiing inspectors, lawyers, media attention to fact your foundation is not in good condition is a win all game. That house is tagged ICC, the internet, flood insurance etc has long records.

I cemented my few little cracks, leveled my lower level floor and moved on. We even jackhammered a whole to make sure it was on solid ground. Contractor did it for free.

Most homes were built in Levitt brothers type speed on the 50x100 plots by 20 something workers who just returned from WWII. My old neighbor saw houses on my block going up 60 years ago, Budweiser, cigarettes, coffee and a mandate to get if framed up in one day and move to next house is how it went. Yet 65 years later we have folks questioning the foundation.

My nieghbor was laughing when I asked why house near me was around three feet higher then nearby houses. He said they went to built it and hit water right away. So they built a few more on block and threw dirt on the plot raising it up a few feet then built house on top of mound. I bet guy who owns house is claiming Sandy causes a shift.

Building codes are fairly loose now on Long Island, 40-80 years ago when most houses were built there were almost no codes and no inspectors.

Yet you want NFIP to be able to know a house built on a sandbar 70 years ago the crack under your 1960s Den complete with Shag Carpeting occured during Sandy and not any other time. Hard to say.

Monday, August 26, 2013 | Report this
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