House passes Donovan homeowner protection bill

Rep. says post-Sandy inspectors changed insurance reports

May 4, 2016 By Paula Katinas Brooklyn Daily Eagle

In addition to destroying hundreds of homes, Superstorm Sandy also damaged the seawall in Bensonhurst. Eagle file photo by Paula Katinas

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U.S. Rep. Dan Donovan said that legislation he sponsored that was recently passed by the House will go a long way toward ensuring that homeowners who are still rebuilding from Superstorm Sandy are treated fairly.

Donovan (R-C-Southwest Brooklyn-Staten Island) introduced a bill aimed at addressing problems with reports filed by the Federal Emergency Management Agency (FEMA) following inspections of homes belonging to residents seeking government assistance to rebuild.

Donovan’s bill, which the House passed last week, would require engineers and adjusters to provide copies of their reports to the insurance policyholder before providing copies to anyone else.

It would eliminate the opportunity for anyone to fraudulently alter an engineering report without the policyholder’s knowledge, according to Donovan, who charged that a spate of incidents has taken place in which reports were altered to minimize damages found in homes and, by extension, minimize payments a homeowner would receive.

Donovan cited a post-Sandy investigation on 60 Minutes on CBS that revealed some reports were fraudulently altered to minimize damage claims. During the claims adjustment process, an engineering report passed through multiple reviewers before final approval or rejection, 60 Minutes reported.

The policyholder had no access into the process or into any of the changes that might be made to the original report, Donovan said.

Superstorm Sandy hit the East Coast on Oct. 29, 2012, destroying thousands of homes and causing billions of dollars worth of damage.

“Two of the biggest reasons I went to Washington were to secure health treatment for heroes who worked at Ground Zero after 9/11, and to help those affected by Superstorm Sandy going through the ‘storm after the storm.’ I accomplished the first, and I’m so proud to take this step toward accomplishing the second,” Donovan said in a statement.

Donovan’s bill also seeks to address the process of appealing claim decisions for flood insurance policyholders.

Currently, homeowners who wish to contest a claim denial can appeal directly to FEMA or file a lawsuit within one year of the original denial. If a lawsuit is filed, however, the FEMA appeal ends.

Donovan charged that the procedure is flawed because it forces policyholders to file lawsuits if FEMA does not resolve the appeal within a year, costing taxpayers money and placing added burdens on flood victims.

Donovan’s bill extends the deadline for filing suit to allow claimants time to first pursue their FEMA appeal in full.

Donovan originally proposed these ideas in the Flood Insurance Mitigation and Policyholder Protection Act, which he introduced in September of 2015. The language from the bill was added to a larger piece of legislation, the PREPARE Act, which was passed by the House last week.