FEMA officials appointed a person familiar with taking control of emergency situations when they appointed a retired United States Coast Guardsman to take control of the Superstorm Sandy mess. The mess was largely created by WYO “Dogs on a Leash” lawyers discussed in yesterday’s post, Insurance Company Lawyers Called "Dogs on a Leash." Unlike the evading and covering-up lawyers previously in charge, Brad Keiserman gives straight answers to direct questions. He seems sincerely interested in acknowledging and correcting current injustices. We hope he will tackle the reform aspect of National Flood claims following a full investigation that is just in its infancy.
As noted in Kieserman Appointed to Lead FEMA Superstorm Sandy Investigation of WYO Claims Handling, I am a little biased about Coast Guardsmen because my father and my sister have both served in the United States Coast Guard. I grew up on the water and around boats. You never know how people respond and perform until you find yourself in extremis, where logical action and leadership is called upon. I like Kieserman’s pedigree because before he embarked on a stellar legal career, it is obvious that the Coast Guard considered him a leader as noted in a small part of his biography:
His tours of duty in the Coast Guard included 11 years at sea, 10 years as a federal maritime law enforcement officer, and two years as Commanding Officer of the USCGC Point Countess in South Florida. Mr. Kieserman was a first responder during the Exxon Valdez oil spill in 1989 and the Caribbean mass migrations in 1994, and participated in dozens of search and rescue operations at sea.
Speaking on behalf of FEMA, he did not evade tough questions posed by CBS. He acknowledged wrongdoing so bad he referred the matter to the Inspector General. He indicated that signs of unethical conduct were present and should have been brought to the attention of FEMA officials. He indicated that WYO partners of the National Flood Program should be better monitored for ethical behavior. And importantly, he is committed to getting fair settlements of those harmed by these activities taken care of, although acknowledging he cannot waive a “magic wand.’ (Maybe I can help him with that.)
From my experience, the National Flood Program’s claims with WYO insurers turned into an attorney overseen claims program through chummy and good old boy relationships. Annual National Flood Insurance conventions were largely orchestrated by one law firm representing most of the WYO carriers. Catastrophe adjusting firms and expert witness vendors had little ethical training except for instructions from those attorneys that relied upon them to win lawsuits. Those lawyers were allowed to espouse legal theories that the National Flood Program Act should be conservatively and literally read and thereby allow many victories purely through technical argument rather than what was owed on a loss.
This culture where the insurance customer is treated as the enemy and subject to threats of zero compensation based upon overly technical insurance rules largely not found in insurance common law must stop. FEMA officials have taken a good step by appointing a person to investigate and make reform trained in the law but has experience with how systems and people can run afoul and get in trouble. He should be able to craft laws and policies that protect the innocent (policyholders with losses) and prevent others (unethical lawyers, estimators, and experts) from preying upon them. He better do a good job or my father and sister will hear it from me.
Positive Thought For The Day
Progress is impossible without change, and those who cannot change their minds cannot change anything.
– George Bernard Shaw