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Frederick J. Pomerantz, Esq.
(516) 297-3101
Sandy Smith, Esq.
(518) 449-8893


Superstorm Sandy has prompted the Governor's Office and the New York Department of Financial Services (Department) to take a number of actions to assist insureds experiencing loss or hardship due to the storm. The extent and scope of regulatory intervention into the standard practices and procedures of insurers cannot yet be determined but it does appear that insurers will have to continue to adapt to the diverse needs of insureds as well as the specific policies that the Department may implement to address consumer issues.

For example, the Department has implemented a number of measures suspending requirements that would otherwise apply to insurance policies covering property damage resulting from Sandy. Specifically, effective October 26, 2012, Superintendent Lawsky, under the powers granted to him pursuant to New York Insurance Law section 3425 (p), ordered the following:

  • A thirty (30)-day moratorium in the counties of New York, Bronx, Kings, Richmond, Queens, Nassau, Suffolk, Westchester, Rockland and Orange (Designated Counties) prohibiting the termination, cancellation or nonrenewal of automobile, homeowners and, subject to certain exceptions, commercial risk insurance
  • Suspension of the automatic policy renewal provisions contained in these policies.

Additionally, the Governor's Office has announced that certain insurance policy mandates will not apply to claims made under homeowners' policies due to the storm. Homeowners will not have to pay large deductibles that could potentially apply to their property damage claims, and property owners do not have to wait for insurance adjusters to inspect their property damage before taking steps to clean up debris. In response to these directives, the Department has taken the position that (1) hurricane deductibles are not implicated by the storm since there were no sustained hurricane-force winds upon the storm's landfall in New York and (2) insurers should accept a homeowner's evidence, including photos and videos, of damages incurred from the storm in lieu of the usual on-site inspection.

The Governor's Office has also announced that several major state-chartered banks have agreed to waive a number of fees and penalties in response to the impact on consumers of the superstorm. State-chartered banks that will waive the fees include M&T Bank, Apple Savings, Dime Savings Bank of Williamsburg, Emigrant Savings Bank and New York Community Bank. Details vary from bank to bank and consumers should contact their banks for specifics.

In general, state-chartered banks have agreed to temporarily waive:

  • ATM fees
  • Late payment charges
  • Penalties for checks returned due to insufficient funds
  • Overdraft protection transfer fees
  • Penalties for early withdrawal of savings where the customer has a demonstrable need for the funds resulting from the disaster.

Also, the Department has taken an active role in assisting insureds with the claims process. Homeowners have been told to file claims promptly and the Department has assured consumers that insurer claims processing will be closely monitored. A 24/7 disaster hotline has been established to field insurance-related questions as well as to assist insureds in filing claims. The Department has set up mobile command centers in various regions to provide hands-on assistance to insureds in particularly hard-hit areas. The Department has reminded homeowners that damage due to flooding is covered only by flood insurance offered through the Federal Emergency Management Agency (FEMA) and that claims for this type of damage should only be made under those policies.

Further, the largest commercial and personal property insurers based on 2012 Pre-disaster Data Reports filed with the Department are subject to an additional reporting obligation; specifically they were required to file as of November 5, 2012-- and to supplement daily thereafter-- a Claims Data Report in the form set forth on the Department's website. This filing contains, among other things, the number and dollar value of claims and whether the claim is a flood claim or something other than a flood claim.

In addition to the steps taken to suspend or alleviate requirements under property and casualty insurance policies, the Department has instructed health insurers and managed care organizations to abate prior authorization procedures and thereby permit insureds to seek urgent care from participating and non-participating providers. Also, health insurers have been told to allow individuals to refill prescriptions at non-participating pharmacies.

Finally, the New York State Division of Homeland Security and Emergency Services (DHSES) has posted four pages of useful Tips to Avoid Hurricane Sandy Scams at The scams consumers should be aware of include: 

  • Form completion services
  • Phony home inspectors
  • Government grant offers
  • Advance fee loans
  • Water testing and purification

The DHSES's Tips to Avoid Hurricane Sandy Scams also include information about (and ways to report) price gouging, home improvement scams, real estate appraiser scams and charity-related scams.