Beginning August 11, 2016, South Louisiana and in particular, the Greater Baton Rouge, Hammond and Lafayette Areas, experienced the most significant flooding event in our lifetimes.  In a period of 72 hours, some areas experienced nearly 35 inches of rain. Rivers and drainage canals were overwhelmed. Large swaths of land outside the 100 year flood plain were under water. Roughly 110,000 homes and many businesses have been impacted with damages estimated at more than $20 billion. Damages were most significant in East Baton Rouge, Livingston, Ascension, East Feliciana, Iberville, St. Martin, Lafayette, Iberia, Pointe Coupee, St. Helena, Tangipahoa, West Baton Rouge and West Feliciana parishes. More than 50,000 flood policies were in effect in these areas. While the cleanup is underway, the scope of the claims process for this disaster is enormous and is comparable to the aftermaths of Hurricane Katrina and super storm Sandy in the Northeast. 

 

While many are fortunate to have insurance in place, it is important to understand that critical deadlines are quickly approaching which will have significant impacts on the right to recovery under the policy. The National Flood Insurance Program (”NFIP”), is a federal program that was created by the National Flood Insurance Act of 1968 (“NFIA”), 42 U.S.C. §§ 4001–4129. In the Act, Congress acknowledged that private insurers were not providing adequate flood insurance in many areas. Through the NFIA, Congress sought to increase the availability of flood insurance by offering subsidized insurance. The NFIP is administered by the Federal Emergency Management Agency (“FEMA”) and backed by the federal treasury. The NFIP is responsible for paying claims that exceed the revenue generated by premiums paid under policies issued pursuant to the program. Congress authorized FEMA to “prescribe regulations establishing the general method or methods by which proved and approved claims for losses may be adjusted and paid.” 42 U.S.C. § 4019.

 

In 1983, FEMA created the Write–Your–Own (“WYO”) program, authorizing private insurance companies to issue policies as part of the NFIP. 44 C.F.R. §§ 62.23–24. As part of the WYO program, FEMA promulgated regulations prescribing the terms of the Standard Flood Insurance Policy (“SFIP”) to be used by WYO companies. The regulations provide:  “[t]he Standard Flood Insurance Policy and required endorsements must be used in the Flood Insurance Program, and no provision of the said documents shall be altered, varied, or waived other than by the express written consent of the Federal Insurance Administrator.” Id. § 61.13(d). FEMA provides a standard text for all NFIP policies and forbids WYOP companies from making changes; FEMA's interpretations of the policy bind all WYOP participants; FEMA decides what rates may be charged; all premiums are remitted on to FEMA (minus a small fee); if WYOP companies pay out on a claim they get reimbursed by FEMA; likewise with litigation costs. Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 679 (7th Cir.2001).

 

The Standard Flood Insurance Policy requires an insured to send the insurance company a sworn proof of loss within 60 days after the loss. The courts have held that an insurance policy issued pursuant to a federal program must be strictly construed and enforced. Moreover, an insured’s failure to provide a complete sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer’s obligation to pay what otherwise might be a valid claim. The courts have gone further and have held that the insured is largely bound by the sworn proof of loss and any additional claims are barred unless clearly claimed in the proof of loss.  Accordingly, it cannot be overstated how important it is to fully comply with the proof of loss requirement. What makes the claims process more troubling for insureds is the fact that many don’t understand the full nature of the physical damages sustained to their homes and businesses. For instance, tile, brick, electrical and plumbing components, exterior sheathing materials, siding and brick can all be damaged or contaminated as a result of flooding, yet rarely do adjusters approve such damage. It is also difficult to identify the full scope of damages within the 60 day window.

 

Fortunately, on  September 7, 2016, the Louisiana Commissioner of Insurance, James Donelon, made a formal request that the 60 day deadline be extended for an additional 60 days. It is fully expected that FEMA will grant this request. However, insureds should monitor this closely. In the event that the deadline is not extended, a sworn proof of loss must be submitted within 60 days or as early as October 11, 2016 for some. Lawsuits must be filed against the WYO insurance companies within one (1) year of the denial of claims.

To read the letter submitted by Commissioner Donelon, click here. 

Beginning August 11, 2016, South Louisiana and in particular, the Greater Baton Rouge, Hammond and Lafayette Areas, experienced the most significant flooding event in our lifetimes.  In a period of 72 hours, some areas experienced nearly 35 inches of rain. Rivers and drainage canals were overwhelmed. Large swaths of land outside the 100 year flood plain were under water. Roughly 110,000 homes and many businesses have been impacted with damages estimated at more than $20 billion. Damages were most significant in East Baton Rouge, Livingston, Ascension, East Feliciana, Iberville, St. Martin, Lafayette, Iberia, Pointe Coupee, St. Helena, Tangipahoa, West Baton Rouge and West Feliciana parishes. More than 50,000 flood policies were in effect in these areas. While the cleanup is underway, the scope of the claims process for this disaster is enormous and is comparable to the aftermaths of Hurricane Katrina and super storm Sandy in the Northeast. 

 

While many are fortunate to have insurance in place, it is important to understand that critical deadlines are quickly approaching which will have significant impacts on the right to recovery under the policy. The National Flood Insurance Program (”NFIP”), is a federal program that was created by the National Flood Insurance Act of 1968 (“NFIA”), 42 U.S.C. §§ 4001–4129. In the Act, Congress acknowledged that private insurers were not providing adequate flood insurance in many areas. Through the NFIA, Congress sought to increase the availability of flood insurance by offering subsidized insurance. The NFIP is administered by the Federal Emergency Management Agency (“FEMA”) and backed by the federal treasury. The NFIP is responsible for paying claims that exceed the revenue generated by premiums paid under policies issued pursuant to the program. Congress authorized FEMA to “prescribe regulations establishing the general method or methods by which proved and approved claims for losses may be adjusted and paid.” 42 U.S.C. § 4019.

 

In 1983, FEMA created the Write–Your–Own (“WYO”) program, authorizing private insurance companies to issue policies as part of the NFIP. 44 C.F.R. §§ 62.23–24. As part of the WYO program, FEMA promulgated regulations prescribing the terms of the Standard Flood Insurance Policy (“SFIP”) to be used by WYO companies. The regulations provide:  “[t]he Standard Flood Insurance Policy and required endorsements must be used in the Flood Insurance Program, and no provision of the said documents shall be altered, varied, or waived other than by the express written consent of the Federal Insurance Administrator.” Id. § 61.13(d). FEMA provides a standard text for all NFIP policies and forbids WYOP companies from making changes; FEMA's interpretations of the policy bind all WYOP participants; FEMA decides what rates may be charged; all premiums are remitted on to FEMA (minus a small fee); if WYOP companies pay out on a claim they get reimbursed by FEMA; likewise with litigation costs. Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 679 (7th Cir.2001).

 

The Standard Flood Insurance Policy requires an insured to send the insurance company a sworn proof of loss within 60 days after the loss. The courts have held that an insurance policy issued pursuant to a federal program must be strictly construed and enforced. Moreover, an insured’s failure to provide a complete sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer’s obligation to pay what otherwise might be a valid claim. The courts have gone further and have held that the insured is largely bound by the sworn proof of loss and any additional claims are barred unless clearly claimed in the proof of loss.  Accordingly, it cannot be overstated how important it is to fully comply with the proof of loss requirement. What makes the claims process more troubling for insureds is the fact that many don’t understand the full nature of the physical damages sustained to their homes and businesses. For instance, tile, brick, electrical and plumbing components, exterior sheathing materials, siding and brick can all be damaged or contaminated as a result of flooding, yet rarely do adjusters approve such damage. It is also difficult to identify the full scope of damages within the 60 day window.

 

Fortunately, on  September 7, 2016, the Louisiana Commissioner of Insurance, James Donelon, made a formal request that the 60 day deadline be extended for an additional 60 days. It is fully expected that FEMA will grant this request. However, insureds should monitor this closely. In the event that the deadline is not extended, a sworn proof of loss must be submitted within 60 days or as early as October 11, 2016 for some. Lawsuits must be filed against the WYO insurance companies within one (1) year of the denial of claims.

To read the letter submitted by Commissioner Donelon, click here. 

Beginning August 11, 2016, South Louisiana and in particular, the Greater Baton Rouge, Hammond and Lafayette Areas, experienced the most significant flooding event in our lifetimes.  In a period of 72 hours, some areas experienced nearly 35 inches of rain. Rivers and drainage canals were overwhelmed. Large swaths of land outside the 100 year flood plain were under water. Roughly 110,000 homes and many businesses have been impacted with damages estimated at more than $20 billion. Damages were most significant in East Baton Rouge, Livingston, Ascension, East Feliciana, Iberville, St. Martin, Lafayette, Iberia, Pointe Coupee, St. Helena, Tangipahoa, West Baton Rouge and West Feliciana parishes. More than 50,000 flood policies were in effect in these areas. While the cleanup is underway, the scope of the claims process for this disaster is enormous and is comparable to the aftermaths of Hurricane Katrina and super storm Sandy in the Northeast. 

 

While many are fortunate to have insurance in place, it is important to understand that critical deadlines are quickly approaching which will have significant impacts on the right to recovery under the policy. The National Flood Insurance Program (”NFIP”), is a federal program that was created by the National Flood Insurance Act of 1968 (“NFIA”), 42 U.S.C. §§ 4001–4129. In the Act, Congress acknowledged that private insurers were not providing adequate flood insurance in many areas. Through the NFIA, Congress sought to increase the availability of flood insurance by offering subsidized insurance. The NFIP is administered by the Federal Emergency Management Agency (“FEMA”) and backed by the federal treasury. The NFIP is responsible for paying claims that exceed the revenue generated by premiums paid under policies issued pursuant to the program. Congress authorized FEMA to “prescribe regulations establishing the general method or methods by which proved and approved claims for losses may be adjusted and paid.” 42 U.S.C. § 4019.

 

In 1983, FEMA created the Write–Your–Own (“WYO”) program, authorizing private insurance companies to issue policies as part of the NFIP. 44 C.F.R. §§ 62.23–24. As part of the WYO program, FEMA promulgated regulations prescribing the terms of the Standard Flood Insurance Policy (“SFIP”) to be used by WYO companies. The regulations provide:  “[t]he Standard Flood Insurance Policy and required endorsements must be used in the Flood Insurance Program, and no provision of the said documents shall be altered, varied, or waived other than by the express written consent of the Federal Insurance Administrator.” Id. § 61.13(d). FEMA provides a standard text for all NFIP policies and forbids WYOP companies from making changes; FEMA's interpretations of the policy bind all WYOP participants; FEMA decides what rates may be charged; all premiums are remitted on to FEMA (minus a small fee); if WYOP companies pay out on a claim they get reimbursed by FEMA; likewise with litigation costs. Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 679 (7th Cir.2001).

 

The Standard Flood Insurance Policy requires an insured to send the insurance company a sworn proof of loss within 60 days after the loss. The courts have held that an insurance policy issued pursuant to a federal program must be strictly construed and enforced. Moreover, an insured’s failure to provide a complete sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer’s obligation to pay what otherwise might be a valid claim. The courts have gone further and have held that the insured is largely bound by the sworn proof of loss and any additional claims are barred unless clearly claimed in the proof of loss.  Accordingly, it cannot be overstated how important it is to fully comply with the proof of loss requirement. What makes the claims process more troubling for insureds is the fact that many don’t understand the full nature of the physical damages sustained to their homes and businesses. For instance, tile, brick, electrical and plumbing components, exterior sheathing materials, siding and brick can all be damaged or contaminated as a result of flooding, yet rarely do adjusters approve such damage. It is also difficult to identify the full scope of damages within the 60 day window.

 

Fortunately, on  September 7, 2016, the Louisiana Commissioner of Insurance, James Donelon, made a formal request that the 60 day deadline be extended for an additional 60 days. It is fully expected that FEMA will grant this request. However, insureds should monitor this closely. In the event that the deadline is not extended, a sworn proof of loss must be submitted within 60 days or as early as October 11, 2016 for some. Lawsuits must be filed against the WYO insurance companies within one (1) year of the denial of claims.

To read the letter submitted by Commissioner Donelon, click here. 

Beginning August 11, 2016, South Louisiana and in particular, the Greater Baton Rouge, Hammond and Lafayette Areas, experienced the most significant flooding event in our lifetimes.  In a period of 72 hours, some areas experienced nearly 35 inches of rain. Rivers and drainage canals were overwhelmed. Large swaths of land outside the 100 year flood plain were under water. Roughly 110,000 homes and many businesses have been impacted with damages estimated at more than $20 billion. Damages were most significant in East Baton Rouge, Livingston, Ascension, East Feliciana, Iberville, St. Martin, Lafayette, Iberia, Pointe Coupee, St. Helena, Tangipahoa, West Baton Rouge and West Feliciana parishes. More than 50,000 flood policies were in effect in these areas. While the cleanup is underway, the scope of the claims process for this disaster is enormous and is comparable to the aftermaths of Hurricane Katrina and super storm Sandy in the Northeast. 

 

While many are fortunate to have insurance in place, it is important to understand that critical deadlines are quickly approaching which will have significant impacts on the right to recovery under the policy. The National Flood Insurance Program (”NFIP”), is a federal program that was created by the National Flood Insurance Act of 1968 (“NFIA”), 42 U.S.C. §§ 4001–4129. In the Act, Congress acknowledged that private insurers were not providing adequate flood insurance in many areas. Through the NFIA, Congress sought to increase the availability of flood insurance by offering subsidized insurance. The NFIP is administered by the Federal Emergency Management Agency (“FEMA”) and backed by the federal treasury. The NFIP is responsible for paying claims that exceed the revenue generated by premiums paid under policies issued pursuant to the program. Congress authorized FEMA to “prescribe regulations establishing the general method or methods by which proved and approved claims for losses may be adjusted and paid.” 42 U.S.C. § 4019.

 

In 1983, FEMA created the Write–Your–Own (“WYO”) program, authorizing private insurance companies to issue policies as part of the NFIP. 44 C.F.R. §§ 62.23–24. As part of the WYO program, FEMA promulgated regulations prescribing the terms of the Standard Flood Insurance Policy (“SFIP”) to be used by WYO companies. The regulations provide:  “[t]he Standard Flood Insurance Policy and required endorsements must be used in the Flood Insurance Program, and no provision of the said documents shall be altered, varied, or waived other than by the express written consent of the Federal Insurance Administrator.” Id. § 61.13(d). FEMA provides a standard text for all NFIP policies and forbids WYOP companies from making changes; FEMA's interpretations of the policy bind all WYOP participants; FEMA decides what rates may be charged; all premiums are remitted on to FEMA (minus a small fee); if WYOP companies pay out on a claim they get reimbursed by FEMA; likewise with litigation costs. Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 679 (7th Cir.2001).

 

The Standard Flood Insurance Policy requires an insured to send the insurance company a sworn proof of loss within 60 days after the loss. The courts have held that an insurance policy issued pursuant to a federal program must be strictly construed and enforced. Moreover, an insured’s failure to provide a complete sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer’s obligation to pay what otherwise might be a valid claim. The courts have gone further and have held that the insured is largely bound by the sworn proof of loss and any additional claims are barred unless clearly claimed in the proof of loss.  Accordingly, it cannot be overstated how important it is to fully comply with the proof of loss requirement. What makes the claims process more troubling for insureds is the fact that many don’t understand the full nature of the physical damages sustained to their homes and businesses. For instance, tile, brick, electrical and plumbing components, exterior sheathing materials, siding and brick can all be damaged or contaminated as a result of flooding, yet rarely do adjusters approve such damage. It is also difficult to identify the full scope of damages within the 60 day window.

 

Fortunately, on  September 7, 2016, the Louisiana Commissioner of Insurance, James Donelon, made a formal request that the 60 day deadline be extended for an additional 60 days. It is fully expected that FEMA will grant this request. However, insureds should monitor this closely. In the event that the deadline is not extended, a sworn proof of loss must be submitted within 60 days or as early as October 11, 2016 for some. Lawsuits must be filed against the WYO insurance companies within one (1) year of the denial of claims.

To read the letter submitted by Commissioner Donelon, click here. 

Beginning August 11, 2016, South Louisiana and in particular, the Greater Baton Rouge, Hammond and Lafayette Areas, experienced the most significant flooding event in our lifetimes.  In a period of 72 hours, some areas experienced nearly 35 inches of rain. Rivers and drainage canals were overwhelmed. Large swaths of land outside the 100 year flood plain were under water. Roughly 110,000 homes and many businesses have been impacted with damages estimated at more than $20 billion. Damages were most significant in East Baton Rouge, Livingston, Ascension, East Feliciana, Iberville, St. Martin, Lafayette, Iberia, Pointe Coupee, St. Helena, Tangipahoa, West Baton Rouge and West Feliciana parishes. More than 50,000 flood policies were in effect in these areas. While the cleanup is underway, the scope of the claims process for this disaster is enormous and is comparable to the aftermaths of Hurricane Katrina and super storm Sandy in the Northeast. 

 

While many are fortunate to have insurance in place, it is important to understand that critical deadlines are quickly approaching which will have significant impacts on the right to recovery under the policy. The National Flood Insurance Program (”NFIP”), is a federal program that was created by the National Flood Insurance Act of 1968 (“NFIA”), 42 U.S.C. §§ 4001–4129. In the Act, Congress acknowledged that private insurers were not providing adequate flood insurance in many areas. Through the NFIA, Congress sought to increase the availability of flood insurance by offering subsidized insurance. The NFIP is administered by the Federal Emergency Management Agency (“FEMA”) and backed by the federal treasury. The NFIP is responsible for paying claims that exceed the revenue generated by premiums paid under policies issued pursuant to the program. Congress authorized FEMA to “prescribe regulations establishing the general method or methods by which proved and approved claims for losses may be adjusted and paid.” 42 U.S.C. § 4019.

 

In 1983, FEMA created the Write–Your–Own (“WYO”) program, authorizing private insurance companies to issue policies as part of the NFIP. 44 C.F.R. §§ 62.23–24. As part of the WYO program, FEMA promulgated regulations prescribing the terms of the Standard Flood Insurance Policy (“SFIP”) to be used by WYO companies. The regulations provide:  “[t]he Standard Flood Insurance Policy and required endorsements must be used in the Flood Insurance Program, and no provision of the said documents shall be altered, varied, or waived other than by the express written consent of the Federal Insurance Administrator.” Id. § 61.13(d). FEMA provides a standard text for all NFIP policies and forbids WYOP companies from making changes; FEMA's interpretations of the policy bind all WYOP participants; FEMA decides what rates may be charged; all premiums are remitted on to FEMA (minus a small fee); if WYOP companies pay out on a claim they get reimbursed by FEMA; likewise with litigation costs. Downey v. State Farm Fire & Cas. Co., 266 F.3d 675, 679 (7th Cir.2001).

 

The Standard Flood Insurance Policy requires an insured to send the insurance company a sworn proof of loss within 60 days after the loss. The courts have held that an insurance policy issued pursuant to a federal program must be strictly construed and enforced. Moreover, an insured’s failure to provide a complete sworn proof of loss statement, as required by the flood insurance policy, relieves the federal insurer’s obligation to pay what otherwise might be a valid claim. The courts have gone further and have held that the insured is largely bound by the sworn proof of loss and any additional claims are barred unless clearly claimed in the proof of loss.  Accordingly, it cannot be overstated how important it is to fully comply with the proof of loss requirement. What makes the claims process more troubling for insureds is the fact that many don’t understand the full nature of the physical damages sustained to their homes and businesses. For instance, tile, brick, electrical and plumbing components, exterior sheathing materials, siding and brick can all be damaged or contaminated as a result of flooding, yet rarely do adjusters approve such damage. It is also difficult to identify the full scope of damages within the 60 day window.

 

Fortunately, on  September 7, 2016, the Louisiana Commissioner of Insurance, James Donelon, made a formal request that the 60 day deadline be extended for an additional 60 days. It is fully expected that FEMA will grant this request. However, insureds should monitor this closely. In the event that the deadline is not extended, a sworn proof of loss must be submitted within 60 days or as early as October 11, 2016 for some. Lawsuits must be filed against the WYO insurance companies within one (1) year of the denial of claims.

To read the letter submitted by Commissioner Donelon, click here.