New York State gets tough on Sandy insurers

NEW YORK Thu Feb 21, 2013 6:22pm EST

An aerial view shows a house pushed into marshland almost a month after the Oakwood neighborhood in the Staten Island borough of New York was left devastated by Hurricane Sandy, November 28, 2012. REUTERS/Adrees Latif

An aerial view shows a house pushed into marshland almost a month after the Oakwood neighborhood in the Staten Island borough of New York was left devastated by Hurricane Sandy, November 28, 2012.

Credit: Reuters/Adrees Latif

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NEW YORK (Reuters) - New York State has told its financial watchdog to investigate three insurance companies for dragging their heels when it comes to processing claims for damage caused by Superstorm Sandy that slammed the region last October.

New York State Governor Andrew Cuomo said in a statement that consumer complaints against Narragansett Bay Insurance Company, Tower Insurance Company and Kingstone Insurance Company received by the state's Department of Financial Services have been "much higher than average."

"We have been working with the insurance industry to streamline the rules and thank the companies who have responded," Cuomo said in the statement. "But we won't tolerate insurers not doing what homeowners paid them to do."

The insurance companies are being investigated for not sending adjusters or processing claims quickly enough, and not making their representatives available to homeowners, the statement said.

The storm caused around $40 billion of damage in New York State. Loss of property tax revenues, emergency funds, and hefty repair bills have put an additional strain on the stretched municipal finances throughout the state, despite aid from the federal government.

The statement said that policyholders of Narragansett Bay, which is backed by billionaire financier George Soros, complained they could not reach adjusters or that adjusters did not arrive for scheduled appointments.

Complaints against Tower Insurance, whose parent company is Nasdaq listed Tower Group Inc, suggested the company regularly failed to send adjusters to inspect damage, denied claims over the telephone without an adjuster visit, and delayed other claims without justification.

The statement said complaints against Kingstone centered on the company's failure to send adjusters, and failing to conduct comprehensive inspections. The company also denied wind damage claims, disputed settlement amounts, and delayed settlement, according to complaints.

None of the three insurance companies could be immediately reached for comment.

(Reporting By Edward Krudy; editing by Gunna Dickson)

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Comments (1)
revamadison wrote:
This is the reason that property owners need to be sure they insure with a well known, and larger company. Some, like these two companies are probably unheard of outside a general area. They probably sell the policies a lot less expensive than say someone like Allstate, State Farm, or USAA, but then you get what you pay for. In this case, it is apparently nothing. Those mentioned above are not just some penny-Annie company, but amongst the largest in the country, and have agents and offices throughout the United States. That gives them the power to have the money available, so that when a large event such as Sandy comes along, they will have money in the bank, from all those other policies which are not being claimed, in other states. The same goes for auto insurance, and even health or life insurance policies. Lets put it this way: If you haven’t heard about them before, don’t buy from them. Meantime the states where these guys operate, should immediately attach their funds, and pay them back only to cover losses by those companies insureds.

Feb 23, 2013 4:31pm EST  --  Report as abuse
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