Flood Insurance Deadline Quickly Approaching – Further Extensions Doubtful
For victims of Hurricane Sandy in New Jersey and New York still fighting with their flood insurance carriers for additional payments the deadline to file a Proof of Loss is quickly approaching. On April 28, 2014, the Federal Emergency Management Agency (“FEMA”) announced that it was extending the National Flood Insurance Program (“NFIP”) Proof of Loss deadline another six months to October 29, 2014. FEMA further stated in its announcement that it did not anticipate any further extensions. These means that those who have not resolved their flood insurance claim only have another four months to file their Proof of Loss for any disputed amounts.
A Proof of Loss is a federal form used by the policyholder to support the amount they are claiming under their policy, which must then be signed and sworn to, and submitted with supporting documentation to the flood insurance company. The filing of the Proof of Loss is a prerequisite to receiving a supplemental payment. It is also a prerequisite to a lawsuit. Failure to timely file the Proof of Loss with supporting documentation will preclude the policyholder from receiving any additional payments, even if a lawsuit is unnecessary. The deadline to file a Proof of Loss under an NFIP flood policy is typically 60 days, however due to the catastrophic nature of Hurricane Sandy, the deadline has been extended three times already.
While the most recent extension of the Proof of Loss deadline will help thousands of Sandy victims receive supplemental payments, it is not the only deadline with which policyholders have to concern themselves. According to the Standard Flood Insurance Policy (“SFIP”), an insured has one year from the date of a denial of all or any part of their claim to initiate a lawsuit seeking additional amounts under the policy. While any amounts claimed and at issue in a lawsuit must be supported by a timely and complete Proof of Loss meeting the requirements of the SFIP, it is FEMA’s position that the extension of the deadline to submit a Proof of Loss does not alter the one year deadline from a denial for initiating a lawsuit. Further, it is FEMA’s position that the one year statute of limitations period begins from the date of the letter that first denies any part of the claim (an interpretation of the policy that we strongly oppose and has been determined not to apply by certain Federal judges). Based on this logic, some insured’s statute of limitations may have expired already.
About the Author: Christopher W. Gerold is an attorney in Wolff & Samson’s Disaster Recovery Claims Group. Chris represents homeowners, condominium associations and businesses with their Sandy related insurance claims with a special focus on flood insurance. For more information on flood insurance and ways Wolff & Samson can help you with your flood insurance claim, please contact Chris at (973) 530-2061.