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Cuomo: Homeowners Will Not Pay Hurricane Deductibles

Story written by Greg Sleter

Homeowners across areas of New York impacted by Hurricane Sandy will not have to pay deductibles on insurance claims stemming from damage caused by this week’s storm.

Gov. Andrew Cuomo on Thursday said in a press release that the state’s Department of Financial Services (DFS) has informed the insurance industry that hurricane deductibles should not be triggered by the storm. This will prevent coastal homeowners from having to pay deductibles in their insurance policies, Cuomo said.

“Homeowners should not have to pay hurricane deductibles for damage caused by the storm and insurers should understand the Department of Financial Services will be monitoring how claims are handled,” he said.

According to the Governor, many homeowners’ insurance policies for homes located in downstate areas contain hurricane deductibles based on a percentage of a property’s insured value. These deductibles typically range from one percent of a home’s insured value to five percent. For example, with a five percent deductible on a home insured for $300,000, the homeowner would have to pay for the first $15,000 of damage.

“We will be working with insurers to help them respond as quickly as possible to homeowners who need to file claims,” said Benjamin M. Lawsky, superintendent of Financial Services. “We will be sending our mobile command center to hard hit areas to help consumers with insurance questions and problems.”

DFS officials suggest that homeowners who experienced property losses to file insurance claims with their insurers promptly after losses occur and include policy numbers and all information relevant to the loss. To best document losses, officials said homeowners should take photos or videos showing the extent of the losses before cleaning up damage.

Officials also said homeowners should make only necessary repairs to prevent further damage to property, like covering broken windows. Permanent repairs should not be made until after insurers have inspected losses. Damaged personal property should be kept until after an insurance settlement has been reached.

In addition, homeowners should cooperate fully with their insurer and keep a diary of all conversations with the insurance agent, including the agent’s name, as well as the times and dates of all calls or visits.

DFS officials noted that flood damage is only covered by flood insurance, which is a federal program administered by the Federal Emergency Management Agency. Homeowners who have flood insurance and have flood damage should make claims through that insurance.

DFS has activated a Disaster Hotline to answer consumer questions and help with problems. The Disaster Hotline number is 800-339-1759. It is staffed Monday – Friday from 8 a.m. to 8 p.m. and Saturday and Sunday from 9 a.m. to 4 p.m.

Homeowners unable to resolve disputes with insurers can file complaints at http://www.dfs.ny.gov/consumer/fileacomplaint.htm.
marc winters November 02, 2012 at 07:01 PM
Andrew Cuomo has no right to tell insurance companies how to run their business. If one feels that a deductable is not applicable, there are courts to adjudicate such matters. I think it would be great if the insurance companies decide to no longer insure New Yorkers and tell their customers to get their insurance from the governor.
nw November 02, 2012 at 10:33 PM
If you have a mortgage you have to insure your home I am not sure if its a law to have this insurance, like a car, but if it is then it isn't just a deal between a homeowner and an insurance company, but one brokered by the government or a bank.Therefore the government./bank that made the law is responsible to regulate the rules thus keeping the rules fair for the little guy.
nw November 02, 2012 at 10:42 PM
Insurance companies spent many millions of dollars and years of time figuring out how much we should pay so they will still make money after they pay out . The Hurricane clause was written in when the companies realized that the northeast was long overdue for a serious hit. before it was written in, they made billions on the fear that it might come. When they realized that all the cards in the deck were spent and there was still one ace to be handed out, they raised the rates or threatened to leave town . insurance as an idea only works for the insured if the rules stay the same for many years, this isn't the case for us now.
Marc November 03, 2012 at 05:48 PM
So true
SteveP November 06, 2012 at 03:27 PM
I personally don't have a problem with NY or NY residents not having to meet their "storm" deductible. However, I would expect all residents of Florida, Louisiana, Mississippi, Texas, Alabama, etc. to receive the same treatment is all future storms. Saying it wasn't a sustained hurricane at landfall is circumventing the issue and irrelevant. The storm that hit was a tropical system, and the storm surge that hit was part of that cycle which had been a hurricane

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