Gerald Nielsen, the NFIP Katrina and Sandy claims handling topical again here on Slabbed

The chickens are coming home to roost:

FEMA Sets Up Review Process for Sandy Flood Claims ~ Insurance Journal

In light of recent allegations that some insurers in the National Flood Insurance Program (NFIP) may have denied or rejected Superstorm Sandy flood damage claims based on falsified reports, the Federal Emergency Management Agency is now prepared to reopen “every flood insurance claim” filed by Sandy victims, officials announced.

You don’t say. Meantime last night a new commenter stopped in on an old insurance post sharing some information that is worth highlighting:

As someone in the industry who has represented liberty mutual on dozens of their cases it is with certainty that I can say they are the worst slimeballs in the industry second only to State Farm. I have heard their newbie adjusters tell elderly insureds they did not have a claim despite having lost their teeth and fractures to their jaws from slipping on wet floors that had been mopped in dark rooms. I have seen them deny claims that were clearly covered. I have seen them justify and defend cheating beneficiaries of their benefits and I have seen them cheat their own employees.

State Farm just had another reorg and guess who got cut. All of the employees from Mississippi who had to defend Eds Russ and Lecky’s decisions to cheat policyholders. That is how they rewarded their loyal senior staff. It was sad that the local adjusters managers and agents got the shaft for Ed and lecky’s unscrupulous behavior.

Additional vital background can be found here and more recently here.

6 thoughts on “Gerald Nielsen, the NFIP Katrina and Sandy claims handling topical again here on Slabbed”

  1. “SRHS: Public has no right to records about failing retirement plan by Anita Lee”

    The above is just released today in the SH. Hard to believe, but by jove, I believe the old fella that said the SRHS was like the DMR had it down pat!!!! They also ran that place “like it was their own”, as one of the previous employees of the DMR said of their executive director and management team (ie. Bill Walker and Joe Zeigler). I guess we have the same thing going on here – just another link in the chain of $$$ pumping stations along the coast that is keeping the coffers loaded with money for the next election. So bad, so sad. Maybe Judge Schloegel can get this case in her court too. It won’t take her long to stand up to them and make them produce. I hope Anita Lee will get her on top of this.

    1. It certainly appears that srhs wants to hide something and it makes me wonder what else is going on besides the retirement issue. In my opinion, I think srhs should be wide open for a complete financial investigation and records opened to the public. The same goes for other public hospitals in the state. You never know what one could find and that’s why they are putting up such a fight to conceal.

      Speaking of public records, does anyone know what happened to the DMR records and the sunherald?

  2. Doug,
    I am just speculating because I do not have any inside information on the Sandy cases, but I am trying to figure out what incentivized the WYO insurers to underpay flood claims.

    After Katrina, they had a huge incentive to overpay flood claims in order to shift the burden from their own wind coverage and additional living expenses liability and we know that NFIP gave them the green light to max out flood policies without proving the flood loss from the wind loss. The main cases where fraud was obvious were those in which the on-site adjuster or engineer documented wind damage and then some manager who had not seen the property changed it to all flood. We know there were many, many more case of fraud when the on-site adjuster or engineer followed the company line in the first place and those cases were harder to prove and dragged out forever, so many homeowners took a partial settlement to get on with their lives.

    Before Katrina, there was a problem in North Carolina, Virginia, and Maryland of underpayments after Isabel. The chief means of fraud was rigging the adjustment software to underestimate the costs of building materials and construction so that homeowners received considerably less for the loss than the actual replacement costs. I understand the WYO incentive there – they want the software to underpay the costs of drywall, electrical, flooring, etc. on their wind claims also, so they can’t have the flood claim paying a higher price for the same materials and expect to get away with it.

    In the case of Sandy, there is a little of that – not including sales tax in the estimates of building materials, for example – but there seems to be a new widespread attempt to deny claims that storm surge caused foundation damage. So there are quite a few cases in which the on-site adjuster or engineer documented foundation damage due to Sandy, but back in the office it was changed to pre-existing damage due to settling or negligent maintenance. This could be another one of those software-driven efforts to reduce claims – i.e. never mind what the engineer saw with his own eyes, the software says that 2 or 3 feet of water does not cause foundation damage – but the question still is what is the incentive for the insurers to do this? The adjusters and the WYO companies are paid based on a percentage of the claims payments, so they would make more money by saying that the foundation damage is a covered loss. There has to be some secret monetary incentive somewhere that is driving them to deny and fight these claims.

  3. Brian I’ll see what I can dig up. I think at the end of the day this is a case of the tail wagging the dog. If I am not mistaken, many of these cases are NFIP direct.

  4. Northeast homeowners be glad the judges of the EDLA are not overseeing your cases. Otherwise, you, the homeowners, would be the wrongdoers instead of the victims.

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