FEMA Asked to Review Flood Insurance Rules

U.S. Sen. Kirsten Gillibrand (D-N.Y.) is asking the Federal Emergency Management Agency to consider reversing denials of Superstorm Sandy flood claims based on the “earth movement” exclusion.

Gillibrand said recent news reports revealed that Sandy flood insurance claims from “thousands of homeowners across New York and New Jersey” were being denied based on an exclusion under the National Flood Insurance Program (NFIP) managed by FEMA.

In an open letter sent to FEMA Administrator Craig Fugate on June 28, Gillibrand wrote that it is unacceptable for the federal government to use “such loopholes” to deny homeowners the benefits that they have paid for through their insurance premiums.

“I am writing to express my complete dismay at recent reports that potentially thousands of homeowners in New York and New Jersey are being denied claims by FEMA for damage to the foundations of their homes as a result of flooding caused by Superstorm Sandy,” Gillibrand wrote in the letter.

“I understand that these denials are based on a provision in FEMA’s standard flood insurance policy, which is found in the U.S. Code of Federal Regulations (44 CFR, Part 61, Appendix A), that states that FEMA does not insure for loss of property caused directly by earth movement even if the earth movement is caused by flood.”

Gillibrand urged FEMA Administrator Fugate to immediately review the regulatory requirements for FEMA’s standard flood insurance policy and reconsider the denials that have been issued to homeowners based on the “earth movement” exclusion.