Insurance Loopholes And Legal Complexities Baffling Sandy Victims

It’s amazing how a storm can not only destroy homes, businesses and lives, but months later, bring  a whirlwind of insurance nightmares and legal headaches, like an aftershock to an earthquake. So it goes for Sandy victims, who are dealing insurance loopholes and legal issues mucking up their path to recovery.

According to a report by the Wall Street Journal, residents counting on much needed insurance checks are learning that their policies are riddled with loopholes that exempt entire floors from coverage. On the financial side, banks are refusing to release insurance payments until residents can prove how they will spend the money. In short, storm victims are coming up short on cash.

All of this red tape has created another crisis thought impossible in New York City, a shortage of lawyers:

“I know this sounds ironic especially in a place like New York, but there just aren’t enough lawyers,” said Thomas Maligno, who is leading Sandy outreach efforts for Touro Law School, which includes a legal hotline and a new legal clinic on Long Island staffed by a professor and eight students.

Congress approved $60 billion toward Sandy recovery, with $1 million reserved for funding legal services, but it’s looking like that was not enough. Free legal clinics have been inundated with requests from people trying to navigate the complex web of insurance forms and legal documents, all emanating from clusters of different agencies.

The victims feeling the biggest brunt of the legal mess left in Sandy’s wake are low-income people who don’t speak English.

Marcos Garcia, a 36-year old father of three, said through an interpreter that he was denied a FEMA grant because he shared a house in New Dorp, Staten Island, with another family. When both families relocated to separate apartments, only one received assistance for rent and new furnishings.

He signed up with Make the Road New York, a nonprofit legal assistance group for low-income New Yorkers that is working on more than 500 Sandy-related cases, officials said.

“Whatever framework FEMA is using, which isn’t clear, it doesn’t seem to have an appreciation for the way that low-income people are living,” said his lawyer, Danielle Grant, who was hired to help handle the influx of Sandy cases. “That’s a big problem.”

Have you been getting the shaft from FEMA, insurance companies and banks? Let us know your experiences dealing with free legal clinics and the bevy of forms you’ve had to contend with post-Sandy.