Flood insuranceNational Flood Insurance Program to focus more on victims’ needs

Published 17 June 2015

Roy Wright, the newly appointed director of the National Flood Insurance Program (NFIP), said that he will push it to better focus on the welfare and individual needs of disaster victims, following years of scandal within the organization. Wright, who will preside over the federal program beginning this week, criticized the insurance loopholes and complicated rules of private insurance companies that were perpetuated by the NFIP to “nickel-and-dime” policyholders and undermine their abilities to rebuild following a flood.

Roy Wright, the newly appointed director of the National Flood Insurance Program (NFIP), said that he will push it to better focus on the welfare and individual needs of disaster victims, following years of scandal within the organization.

As Newsday reports, Wright, who will preside over the federal program beginning this week, criticized the insurance loopholes and complicated rules of private insurance companies that were perpetuated by the NFIP to “nickel-and-dime” policyholders and undermine their abilities to rebuild following a flood.

The center of gravity needs to continue to shift in favor of the policyholder,” he said.

He added that although the program had already instituted some measure to increase direct interaction and service with policyholders, including the establishment of a call center for flood victims in Oklahoma and Texas to report problems with their insurance, and that would only be the beginning of a new strategy.

We have to put in place a way by which we can detect and monitor and feel these pulses early. And so this hotline is a way to ensure that,” he said.

The NFIP, which falls under the management of the Federal Emergency Management Agency (FEMA), is assuming new leadership with Wright just as FEMA continues to grapple with fallout from allegations and criticisms that the organization underpaid homeowners during the 2012 Hurricane Sandy destruction along the Mid-Atlantic coast.

The allegations have led to an ongoing criminal inquiry, with the departure of top officials from the flood insurance company. FEMA is currently reviewing 142,000 claims after multiple Sandy storm victims and private contractors employed by the government have charged that the agency forged documents to deny proper settlements.

Wright, who has worked at the NFIP since 2007, said that he would consider himself included in the judgments of the probe and would aim to make sure the program runs more and more smoothly, ultimately fixing it entirely to ensure that the mistakes of 2012 are not repeated.

Brad Kieserman, the program’s outgoing director, began four months ago to begin the reforms, but has said that a key piece of changing the organization is to overhaul the entire program.

“The result is a sprawling tangle of contractors and subcontractors,” said Kieserman. “The flood insurance program, which has roughly 50 employees, lost its ability to oversee how homeowners were treated. That business model needs to be analyzed and then restructured.”

Wright added that it was still too early to fully assess the role of private insurance companies within the program.