Insurance companies have paid out more than $4 billion in claims resulting from superstorm Sandy, which barreled through New Jersey a year ago this week. Still, many homeowners complain about settlements that are too low and damage that companies will not cover.
According to the latest figures from the New Jersey Department of Banking and Insurance, homeowners and businesses incurred nearly $4.6 billion in losses, exclusive of claims on flood insurance policies and surplus lines and excess insurers, due to the storm that devastated the Shore and left much of the state without power for a week or more. As of September 15, insurers had paid out roughly 88 percent of that total.
In all, the state reports companies had closed 98 percent of claims as of six weeks ago, and paid on 77 percent of claims submitted.
Data for surplus lines and excess insurers, approximately 2 percent of the homeowners market in the state, is unavailable because these are not regulated by the state. Likewise, the state has not received complete local data from the National Flood Insurance Program, according to Marshall McKnight, a DOBI spokesman.
More than $4 of every $10 paid out has gone to homeowners and another 13 percent was paid out in personal auto insurance claims. Almost 25 percent went for commercial property.
Essex County residents and businesses have received the most money, more than $0.5 billion, with more than half of that reportedly going to the 07114 ZIP code in Newark, which includes Newark Airport, the Port Newark Container Terminal, and land on the Newark Bay. Hard-hit Ocean County also has received more than $0.5 billion in payments, while Monmouth got nearly $460 million.
In addition to Newark South Station, the average amounts paid per claim have been largest in the more industrial areas of the state, including more than $383,000 to Port Elizabeth’s 08348 zip code, and about $310,000 to 07102 in Newark, which happens to be the home of the Prudential Insurance Co.
All claims have been paid in about a dozen ZIP codes throughout the state, while in the 07096 ZIP code near the NJ Turnpike in Secaucus, fewer than 20 percent of claims have resulted in payment.
Problems with insurance have been among the most common complaints from people still trying to repair or rebuild their homes. The issue also came up in the second gubernatorial debate last month, when Democratic Sen. Barbara Buono noted that homeowners who have been denied some or all of what they say they lost and asked Gov. Chris Christie why the state was not suing insurance companies on behalf of residents, as New York and Connecticut have done.
Christie said New Jersey’s settlement rates were “much better” than other states and that the real problem was with the National Flood Insurance Program.
Of more than 100 residents, most of them from the Shore, who answered a NJ Spotlight survey on their experience with insurance, more than 80 percent said they were dissatisfied with the settlement offered. Of those, more than half said their problems were with the National Flood Insurance Program, while about 45 percent complained about their homeowner’s policy or private flood insurance.
Complaints range from insurance companies offering unrealistic settlements given the high costs in New Jersey to refusing to cover mold damage because it happened after the storm to denying wind damage. Several homeowners said they will not have enough money to elevate their homes, as required. People also had complaints when they hired adjusters and several said they planned to sue. Others said they are in desperate financial straits and can’t seem to get help from anyone.
McKnight said the state has not launched any Sandy-related enforcement actions against insurers, but the state’s mediation program continues. More information about that is available from DOBI