Schumer Accuses 3 Insurers Of Canceling Some Long Island Coverage After Sandy

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U.S. Sen. Charles Schumer of New York is accusing Allstate, Liberty Mutual and State Farm of dropping insurance coverage for some Long Island homeowners since storm Sandy hit last fall.

At least one of those insurers, however, say they have not pulled out.

Schumer, a Democrat, said late Monday that his office had received dozens of complaints from constituents who reported their homeowners’ insurance policies were canceled by different companies. Many of the constituents said they had policies for years without any claims, and many had no storm damage from Sandy.

The property-casualty industry, generally, is tightening up on underwriting, meaning that insurers are more careful about the risks they are willing to take. Whether underwriting is a driving factor in the case of the three insurers Schumer criticizes was unclear.

Allstate, Liberty Mutual and State Farm take part in the National Flood Insurance Program, meaning they sell taxpayer-subsidized policies for a fee and the federal government underwrites the risk. Schumer said that unless the three insurers change course on insuring Long Islanders, the Federal Emergency Management Agency should reduce the flood-coverage fees that Allstate, Liberty Mutual and State Farm collect.

“It’s bad enough that homeowner insurance policies are limited on Long Island, but now — with precious little justification — policies are being dropped left and right, even for those who paid all their bill on time and had little-to-no storm damage” Schumer said in a prepared statement.

Liberty Mutual spokesman Glenn Greenberg said in a prepared statement: “We are actively writing new and renewal homeowners insurance business throughout New York State, including Long Island. That has not changed due to Sandy.”

State Farm has not participated in the National Flood Insurance Program since 2010, company spokeswoman Arlene Lester said.

“We first began managing our business and risk profile in coastal regions of New York in 2007,” Lester said in a prepared statement. “The process is ongoing and will continue to evolve as we evaluate coastal exposure and make adjustments where appropriate. By planning effectively and balancing the risks we insure, we are in the best position to keep the promise we make to policyholders to help them recover from the unexpected.”

Allstate spokeswoman Julia Reusch said the company continues to insure homes on Long Island and other coastal areas.

“We have taken careful steps to manage our exposure in catastrophe-prone areas,” Reusch said in a prepared statement. “These steps were carefully and responsibly thought through to help ensure we will be there to meet customer needs, even in the face of the unprecedented weather-related challenges we face.”

For insurers that do provide flood coverage, Schumer said, “These insurance companies should not leave Long Island families and the federal government holding the bag and so today I am urging them to put a stop to these policy cancellations.”

About Matthew Sturdevant

Full-time staff journalist at The Hartford Courant and magazine freelancer with a master's degree in writing from Dartmouth. My work has appeared in The Los Angeles Times, The Chicago Tribune, Taiwan News, The Baltimore Sun and many other news sources. My blog has been referenced by Politico.com, the Kaiser Family Foundation, the Georgetown Law Library and a number of organizations in healthcare and business. Sturdevant’s blog is "a well-written wealth of ideas," said The Donald W. Reynolds National Center for Business Journalism, (businessjournalism.org, May 18, 2011). I have experience writing for newspapers, magazines, Web sites and blogs as well as shooting and editing video. I made regular appearances on news-talk radio and on the NBC affiliate station in Corpus Christi, Texas. I made occasional appearances on the Fox affiliate in Connecticut promoting Hartford Courant articles.

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2 thoughts on “Schumer Accuses 3 Insurers Of Canceling Some Long Island Coverage After Sandy

  1. pete

    Yes boys and girls SOCIALISM has consequences. Remember when loud mouth Schummer berated the insurance companies for not paying out enough mula after Sandy since the insurance policies didn’t cover certain things. Well it is the old saying fool me once shame on you fool me twice shame on me

  2. kes

    No taxpayer subsidized policies……period. if you can’t afford to live on the coast, get off the coast.

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