The New York Department of Financial Services says the actions of three insurers following Superstorm Sandy are “totally unacceptable,” and warrant an investigation.

Gov. Andrew M. Cuomo says the state DFS is investigating the alleged failure of Narragansett Bay Insurance Co., Kingstone Insurance Co., and Tower Insurance Co. to send adjusters and process claims in a timely manner after the Oct. 29, 2012 storm struck the Northeast.

The DFS has issued a demand for information to each of the companies. The insurers are required to respond.

Tower Group Refutes Allegations of Poor Sandy-Related Claims Practices

According to the state, which has been tracking complaints against insurers since Sandy, policyholders of Kingstone filed complaints for the insurer's alleged failure to send, or timely send, an adjuster. Policyholders also allege partial inspections, the denial of wind-damage claims, as well as disputed and/or delayed settlements

Policyholders of Tower have complained of the insurer's alleged failure to send adjusters. Some say claims were denied over the phone, with no adjuster visit, says the DFS. Additional complaints against Tower include wrongful denial of claims under the sewer backup exclusion, difficulty reaching the company, and of delays in the claims process.

Narragansett policyholders have complained they have been unable to reach adjusters, or the adjusters have missed appointments.

Narragansett, Kingstone and Tower were not immediately available to comment.

“These practices and the volume of complaints on outstanding claims are totally unacceptable,” says Benjamin M. Lawsky, superintendent of the DFS, in a statement. “We know that the storm produced extraordinary circumstances, but we still expect insurers to live up to the highest standards.”

New York law requires insurers inspect damaged property with 15 business days of a filed claim. On Nov. 29 that timeline was shortened to six business days for some properties, say state officials.

Insurers must send a letter to policyholders explaining the delay if they are not able to settle a claim with 15 business days of a claims investigation.

According to a website set up to track complaints, Tower has had 249 complaints out of 16,777 total claims filed from Sandy.

Policyholders of Narragansett have logged 147 complaints. The insurer has taken 11,029 total claims.

There is no data available for Kingstone.

By no means do these companies lead all insurers in complaints, but their ratio of complaints compared to total claims is among the highest.

For instance, complaints against Allstate stand at 528, but the insurer has logged more than 81,507 claims.

Special Reports /

New York to Investigate Three Insurers for Handling of Sandy Claims

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