TRENTON – The commissioner of the Department of Banking and Insurance said today some 452,000 claims have been reported to insurance companies, and DOBI has received 1,137 consumer inquiries, due to superstorm Sandy.
Of those, DOBI head Ken Kobylowski said, only 262 have been “formal requests” to intervene in an adjustment or dispute process.
Some of those interventions involve flood insurance, which unfortunately for the consumer, DOBI has no control over.
“That is beyond our jurisdiction…ultimately the federal government is in charge,” Kobylowski said during an Assembly panel hearing into Sandy-related insurance issues.
He said it’s important for the home insurance marketplace to remain competitive in order to have as many of them here as possible to keep rates under control.
“We all need companies that want to be here,” he said.
Following the storm, Kobylowski said, Gov. Chris Christie signed executive order 107, which instructed insurance companies they can’t charge hurricane deductibles, since the National Weather Service determined that Sandy was a post-tropical storm prior to landfall.
That move, he said, saved consumers thousands of dollars. For example, instead of having to pay $20,000 to $30,000, a standard deductible of $2,000 to $3,000 was applied.
However, Assemblyman Peter Barnes said that in some cases, consumers chose to take hurricane deductibles instead of standard deductibles because it was cheaper. Ultimately, he said that the risk is transferred from the homeowner to the insurance company, which he said could result in higher insurance rates for other policyholders.
Barnes asked the commissioner whether that could prompt insurance carriers to leave the state.
“Solvency of carriers is a big concern,” he said.
Kobylowski said it was too early to know what impact Sandy have on the homeowners insurance marketplace.
There are 2.5 million homeowner insurance policies in New Jersey.
Assemblyman Sean T. Kean said the insurance companies have been doing a good job, given the relatively low number of inquiries.
“At this point claims are being responded to,” he said. “They have to get some credit.”
But Assemblyman Lou Greenwald (D-6) said homeowners’ insurances need to be more clearly defined. “They really don’t know what it covers.
“I think that’s something that’s broken here. There shouldn’t be a loophole.”