Information from Flood Damage Lawyers, New Orleans, Louisiana
Flood damage can be devastating to your home or business. While wind damage
can create openings in your structure when roofing shingles or siding
is ripped off, perhaps causing water to penetrate the interior in several
places, significant flood damage nearly always results in catastrophic
losses to both the exterior of the structure and the interior contents
of the building. As a result, flood damage attorneys are often required
because the insurance claims inevitably involve high value damages. When
insurance companies face a sudden rise in high value insurance claims
due to flooding that occurred across an entire city, town, or other community,
the insurance companies will do everything they can to decrease the amount
that is paid out for claims. As a result, you may find yourself fighting
with your flood insurance company over the course of many months with
little hope of receiving the amount that you are owed for your flood insurance
claim. A hurricane lawyer can help navigate the claims process, and seek
to recover the maximum amount for your flood insurance claim.
How are flood insurance claims different than wind damage claims?
Flood insurance claims are different than wind claims primarily due to
the fact that flood claims fall under federal jurisdiction. This means
that any lawsuit that arises out of a flood claim must be litigated in
federal court and decided according to the federal laws contained in the
National Flood Insurance Act (NFIA) of 1968. As a result, home and business
owners face a significant disadvantage after a hurricane when seeking
to recover payments due from their flood insurance companies. This is
because federal law, which will apply in a flood damage lawsuit, does
not provide the same protections for home and business owners traditionally
afforded by state law.
Most state laws governing insurance disputes, including those in Louisiana,
include significant penalties that can be assessed against insurance companies
for bad faith practices. For example, if your Louisiana insurance company
fails to handle your claim fairly or in a timely manner, the company may
be liable for up to three times the value of the original claim after
bad faith penalties are applied. The NFIA, however, does not contain such
protective measures for home and business owners. As a result, private
insurance companies that offer flood insurance do not have the same incentive
to treat home and business owners fairly. Inevitably, claims are adjusted
more slowly and the insured home or business owner does not receive the
full value of their flood damage claim.
While state governments across the country have seen the wisdom in making
bad faith penalties available for vehicle insurance, commercial liability
insurance, and homeowner’s insurance claims, the federal government
has not provided the same protections for victims of flood damage who
have nonetheless taken the responsibility to purchase flood insurance
for their home or business.
Flood Insurance through the National Flood Insurance Program (NFIP)
Since typical home owner’s insurance policies do not provide coverage
for flooding, it is essential that you purchase separate flood insurance
through the National Flood Insurance Program (NFIP) if you live in area
that is at high risk for flood damage. The NFIP was established in 1968
when Congress passed the National Flood Insurance Act (NFIA). The adoption
of the NFIA and NFIP was a reaction to private insurance companies charging
excessively high premiums for many years. With the passage of these acts,
flood insurance became affordable to the general public. Between 1968
and 1977, the flood insurance through the NFIP was primarily administered
by a group of private insurers that were supervised and supported financially
by the Department of Housing and Urban Development. In 1977, the Federal
Emergency Management Association (FEMA) took charge of the NFIP.
Currently, flood insurance policies can be issued by FEMA directly or by
private insurers called write your own (WYO) companies. While there are
fewer WYO flood insurance companies than there were when the NFIP was
first passed into law, private insurers still do offer comprehensive flood
damage policies, collect premiums, handle claims, and make payouts to
flood damage victims.
What if my insurance says it will not pay for damage above the flood water line?
If you have suffered flood damage and have tried to negotiate with your
insurance company, you may have heard your adjuster say that the insurance
company will not pay for damage above the flood water mark. Louisiana
law, however, states that no insurance company shall use the flood water
mark on a structure without considering other evidence, when determining
whether a loss is covered or not covered under a home owner’s insurance policy.