Risk Management

Payment on Sandy Claims to Arrive Sooner

New regulations require insurance companies to send adjusters to claimants within six business days after claims are filed, although insurers insis...
Caroline McDonaldNovember 30, 2012

New requirements for insurers in New York regarding claims for damage by superstorm Sandy, announced yesterday by Gov. Andrew Cuomo, may sound like good news for businesses and other policyholders. According to the New York Insurance Assn. (NYIA), it’s more like overkill.

At Cuomo’s direction, the state’s Department of Financial Services (DFS) issued a new regulation that cuts by more than half the time frame after a Sandy-related claim is made within which insurers must send adjusters to homes and businesses. The move is aimed at helping insureds get their payments sooner. Insurers now must start investigating claims within 6 business days of receiving them, rather than the 15 business days normally allowed.

The DFS also is publishing data on insurance companies’ performance in responding to the disaster and paying claims on a new website, www.NYInsure.ny.gov.

According to Ellen Melchionni, president of the NYIA, insurers are already complying with the six-business-days time frame. She says the association has supplied the governor’s office with data supporting that contention, adding that complaints have been filed on less than 1% of the 360,000 claims made so far to 24 insurers.

Melchionni notes that although New York has tightened insurance regulations, it is actually customary for states to relax them after such a disaster. In the context of Sandy, she explains, insurance adjusters have dealt with hardship, including closed roads, gasoline shortages, and the poststorm requirement that vehicles have three passengers to be allowed into Manhattan.

Cuomo also signed an executive order that the DFS allow for expedited, temporary licenses to be issued to qualified out-of-state public insurance adjusters to help speed up claims settlements.