On February 25, 2013, it was announced that the New Jersey Department of Banking & Insurance would be establishing a mediation process to give consumers the option to settle disputed Storm Sandy claims with their insurance carrier. Governor Christie announced recently that, as of February 15, 2013, the percentage of claims closed is 87% overall and 91% for homeowners. The mediation program would be an opportunity to resolve the remaining claims. The mediation program will be open to non-flood homeowners, automobile and commercial property claims over $1,000.00. Insurance carriers will pay the cost of the mediator. The program will not include flood insurance claims because those are handled by The National Flood Insurance Program pursuant to federal regulations. However, the Department of Insurance will continue to monitor those claims and assess the viability of securing The National Flood Insurance Program?s participation in the mediation program at a later date. State regulated insurers are required to notify insureds with open or unresolved homeowners, auto and commercial claims that they can ask for mediation. Participation by policyholders is completely voluntary. Insurers admitted to do business in New Jersey are required to participate in the mediation program. Surplus lines insurers can participate in the program on a case-by-case basis.
In our view this is a positive development for policyholders and insurers. New Jersey consumers who are in desperate need of funds to repair or rebuild now have a free opportunity to make their case before a neutral party and the prospect of resolving their claims with confidence. Insurers, who are eager to get a handle on their losses now have an opportunity to close the remaining open claims and plan for the future.