Imagine you have a structurally sound home on October 28, 2012. The next day, Hurricane Sandy hits and floods your home. When you return, you find your floors are buckled and severe foundation damage. Now imagine your flood insurance adjuster tells you either that the damage was preexisting or that flood insurance does not cover damage from soil shifting regardless of whether or not the soil shifting was caused by flood. Believe it or not, this is a situation in which many of our clients have found themselves.

Fortunately, they have an ally in New York Senator Kirsten Gillibrand. Senator Gillibrand recently wrote a letter to the administrator of FEMA regarding such claims.

The text of her letter is below.

Dear Administrator Fugate,

I am writing to express my complete dismay at recent reports that potentially thousands of homeowners in New York and New Jersey are being denied claims by FEMA for damage to the foundations of their homes as a result of flooding caused by Superstorm Sandy. I understand that these denials are based on a provision in FEMA’s standard flood insurance policy, which is found in the U.S. Code of Federal Regulations (44 CFR, Part 61, Appendix A), that states that FEMA does not insure for loss of property caused directly by earth movement even if the earth movement is caused by flood.

It is unacceptable for the Federal government to use such loopholes to deny responsible homeowners the benefits that they have paid for through their insurance premiums. To deny these claims pulls the rug out from underneath homeowners who are relying on their flood insurance policies to repair and rebuild their homes, now nearly eight months after Sandy hit our shores.

While I understand that flood insurance policies cannot cover every single loss that was incurred as a result of Superstorm Sandy, damages that were a result of storm surge and encroaching flood waters should not be excluded from flood insurance policies. To address this issue, I request that you immediately review the regulatory requirements for FEMA’s standard flood insurance policy and reconsider the denials that have been issued to homeowners based on the “earth movement” exclusion. I also request that you keep my office informed of the status of this request, and the actions that FEMA plans to take to address these concerns.

Thank you for your attention to this urgent request.

I hope FEMA responds favorably to this request. I will continue to monitor this issue and post updates as more information becomes available.