In a recent case,1 a federal court dismissed a flood claim following a nor’easter storm because the insureds’ proof of loss under the National Flood Insurance Act failed to satisfy the Standard Flood Insurance Policy’s (“SFIP”) “signed and sworn” requirement.2 In that case, the insureds submitted two claims to recover damages from the storm to their insurance company. The first claim of approximately $2,000 was completed on a form provided by the Federal Emergency Management Agency (“FEMA”). Both insureds signed and dated the document, which stated, “I declare under penalty of perjury that the information contained in the foregoing is true and correct to the best of my knowledge and belief.” Shortly thereafter, the insurance company issued a check to the insureds for the covered building damages.

Sometime after, the insureds submitted a second claim to their insurance company seeking an additional payment of approximately $250,000. The insureds’ proof of loss for the second claim differed from the first claim in two “important” ways. First, the form was provided by the insureds’ public adjuster. Second, while both insureds signed the document, it was not dated and lacked any declaration acknowledging a “penalty of perjury.”

The insureds sued for breach of the insurance contract after the insurance company denied their second claim because the proof of loss for that claim was both unsworn and not dated. The insurance company argued that the insureds’ failure to comply with the SFIP’s “signed and sworn” proof of loss requirement barred the insureds’ recovery for their otherwise valid claim.

Ultimately, the court agreed with the insurance company, ruling that the proof of loss for the second claim fell short of an affirmative acknowledgment of perjury required for parties submitting sworn declarations under a federal regulation. Therefore, the insureds’ failure to comply with the SFIP’s “signed and sworn” proof of loss requirement precluded them from recovering damages for their second claim.

This case highlights the importance and significance of complying with all terms and conditions of federal regulations.
1 Hagstotz v. Nationwide Mut. Ins. Co., No. 17-2491, 2018 WL 5005000 (D.N.J. Oct. 16, 2018).
2 In particular, Article VII(J)(4) of the SFIP provides, “Within 60 days after the loss, send us a proof of loss, which is your statement of the amount you are claiming under the policy signed and sworn to by you…”