Sandy Claims Issues Could Bypass Courts
|Ed Beeson, Star-Ledger Staff|
Policyholders at odds with their insurer over Hurricane Sandy-related claims soon will have a more cost-effective and efficient way to resolve their differences over coverage, the Christie administration announced yesterday.
The program would sit an experienced mediator between policyholders and their insurance companies in order to review the case and assist in settlement discussions. Similar efforts were undertaken with success in
"I think there will be a significant cost savings compared to litigation," Kobylowski said in an interview.
The mediation process would be available to policyholders with open homeowners, auto and commercial claims with a standard insurance company, such as
The state's program will not be open to flood insurance claims, which are overseen by the National Flood Insurance Program. The department, however, is examining the possibility of having flood insurance claims mediated down the road.
"We're still working with the NFIP on that issue," said
So-called surplus line insurers, which provide coverage in situations where standard carriers won't, will be allowed to participate in the program on a case-by-case visit. Surplus carriers insure a number of properties along the Jersey Shore.
Insurance companies will pay for the cost of the mediator, although policyholders will be expected to pay their own legal costs, such as hiring an attorney, Kobylowski noted. Claims would have to be greater than
Mediation also is only available for policies in force at the time Sandy made landfall.
Kobylowski said the department expects to have the mediation program up and running by early April.
A key driver on which company gets chosen, he said, is experience with running similar programs and the ability to handle large volumes of disputed claims. The commissioner said the program could end up processing about 20,000 to 25,000 disputed claims.
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