Flood Damage

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.