Eastern District Awash in Sandy Insurance Cases
Other disputes are being resolved through the New York State Department of Financial Services' Storm Sandy Mediation Program, an arrangement where the insurer picks up the $400 tab for a mediator. As of Feb. 10, the state program had received 2,708 requests for mediation. Of that figure, 1,460 have been settled, said a Department of Financial Services spokesperson.
Rajotte said "the main problems are, the insurers are undervaluing what everyone—the homeowner, the public adjuster—has agreed has been damaged. And number two, they're not considering the proper scope of repairs—what it would take to fix it."
The Touro clinic has already filed four Eastern District lawsuits and intends to file another 15 in the coming weeks. In all of them, homeowners got 50 percent less from their insurers than they needed to repair storm damage.
For example, the clinic represents Joe and Marilyn McDonald, a retired couple whose Amityville home was flooded by five feet of water inside. In the McDonalds' Jan. 23 suit, they allege Allstate Insurance Company breached its obligations to pay the full amount they are due under their policy.
So far, Allstate has offered them $38,400. But the McDonalds said the damages to their home totaled $234,000, and they have been unable to make all their repairs.
The couple's repeated calls to Allstate have been unsuccessful.
"They just totally dismissed me," said Marilyn McDonald, who is 65. "I felt like I was being scammed."
Rajotte said FEMA, which manages the National Flood Insurance Program, extended the deadline to file proof of loss to 18 months after the October 2012 storm, to April 29, 2014. But it did not extend the deadline for policyholders to submit a federal lawsuit against their insurers: that's still one year from the insurer's first written denial of a claim.
Each Sandy victim has his or her own, individual deadline to file a lawsuit, Rajotte explained, which in many cases could come well before April 29.
Javier Delgado of the Merlin Law Group said there could be more suits to come. With main offices in Tampa but also locations including New York and New Jersey, the firm is representing commercial and residential plaintiffs in "several hundred" Sandy cases that are mostly in federal court.