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U.S. flood insurance program faulted for Isabel settlements
Report due out today points to agency problems

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Rebuilding after Tropical Storm Isabel

Rebuilding after Tropical Storm Isabel
Mar 21, 2004

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I think if the nfip and insurance companies had just took a gun to us and got us to sign over the deed it would have been easier. Why prolong the misery.
Submitted by: going crazy
Oct 7, 2004, 1:00 PM EDT
I think everyone has been on edge who is displaced. I was married 3 weeks before Isabel on my pier. My wife said she was going to change my life, I had no idea!
Submitted by: GH
Oct 7, 2004, 11:05 AM EDT
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In Depth
Hurricane Isabel archived coverage

Hurricane Isabel archived coverage

Sun Staff
Originally published September 29, 2004
Conflicts of interest and communication problems in the federal flood insurance agency have prevented Maryland victims of Tropical Storm Isabel from receiving adequate settlements for storm damage, according to a report that Baltimore County plans to release today.

Relying on internal government documents, videotaped interviews with federal officials and letters from experts, the report by flood insurance activist Steve Kanstoroom paints a bleak picture of the Federal Emergency Management Agency's efforts on behalf of victims of last September's storm.


"FEMA's response has deteriorated to the point of stonewalling the victims and attempting to mislead our representatives into thinking the victims have received the compensation they are entitled to," the Talbot County activist wrote. "Recently it has become abundantly clear FEMA is attempting to quiet the squeakiest wheels rather than implement policies to correct its problems."

With a change in leadership at the National Flood Insurance Program and a record four hurricanes in Florida this year taxing FEMA's resources, the report says, the push for a comprehensive solution to problems exposed by Isabel has waned.

Despite months of protest from storm victims and demands from Congress, many problems have not been corrected, and many who lost their homes in last year's storm still have not received fair compensation, the report says.

Program reform

In spring, amid thousands of complaints from Isabel victims and pressure from Congress, federal flood insurance officials agreed to reform the program and re-evaluate any claims from dissatisfied Isabel victims. The agency paid millions in supplemental claims as a result.

Baltimore County Executive James T. Smith Jr. requested Kanstoroom's report as a follow-up to a study by former Maryland Insurance Commissioner Steven B. Larsen. The Larsen report, released in February, relied on a survey of victims to point out shortfalls between flood settlement offers and the cost of repairs, misleading or incorrect statements from flood insurance agents, and pressure to settle from adjusters.

Kanstoroom's report is focused on identifying the causes of the problems that Larsen identified and of others that have developed since the previous report was written.

Smith said 65 families in Baltimore County are still living in trailers because they have been unable to rebuild their homes, adding that he doesn't think FEMA has done enough to prevent future problems. He said he will forward Kanstoroom's report to the Maryland Insurance Administration, the U.S. attorney's office and to Maryland's congressional delegation.

"Our people need to be restored to their pre-storm condition," Smith said. "They do not want a handout, but they deserve the coverage the law affords."

Kanstoroom, who has met repeatedly with top officials at the federal flood program, the Maryland insurance program and with state and federal elected officials over the last six months, said he is worried that victims have given up hope for higher settlements.

He said adjusters are denying some victims payments for kinds of damage that have been paid in other claims and that the federal flood program didn't do an adequate job of letting people know what should be covered so they would know if they were due more money.

Despite the time that has passed since the storm, advocates and elected officials continue to work on the issue, so victims shouldn't give up, he said.

"Victims are hearing misinformation, and they're making life decisions based on that misinformation," Kanstoroom said. "These are things they are going to live with for the rest of their lives."

Kanstoroom said the report will be available on the Internet today at www.femainfo.us.

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