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NY Legislation to Reduce Unfair Sandy Insurance Claim Settlements

Posted on Feb 19, 2013

After many New Yorkers have been on the receiving end of denied insurance claims and unfair claim settlement practices following Hurricane Sandy, a New York state lawmaker recently introduced legislation that may help prevent unfair claim settlements during a declared state disaster emergency.

 

Assemblywoman Nicole Malliotakis (R,C,I-Brooklyn, Staten Island) defined what constitutes an unfair claims settlement practice and drafted legislation that clarifies what would be considered unfair insurance practices during a declared state disaster emergency. Some of poor practices used by insurance companies include:

  • Little action taken
  • Poor communication
  • Lack of urgency
  • Unreturned phone calls
  • Unjustifiable insurance claim denials

The bill spells out specifically what are unfair settlement practices and creates a private right of action for violations to create a civil remedy—protecting the insured and not the insurer during a declared state disaster. Unfortunately for those dealing with insurance companies in the aftermath of Hurricane Sandy, many have been on the receiving end of poor settlement practices even though they have faithfully paid their insurance premiums for years.

 

“Residents face a long road to recovery and certain insurance carriers have provided nothing but obstacles. It’s time they assumed their rightful role as part of the solution, rather than the problem. It’s time New York changed its laws to protect the consumer and not the insurance company,” said Mallitokis.

 

Other New York and New Jersey insurance claims-related bills introduced since Sandy include:

  • New York “Homeowners Bill of Rights” bill
  • New Jersey Assembly Bill A3642
  • New York Assembly Bill S01760/A01222

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