New Jersey’s State-Launched Mediation Program Helpful for Some Sandy Victims
Thursday, September, 5, 2013
In the onslaught of claims that were the result of last year’s Hurricane Sandy, the State of New Jersey began a mediation program that would be run by the American Arbitration Association and was put into place to help victims of the storm settle unpaid claims with their insurance companies. Although the program did not include flood insurance claims, it was created to handle both homeowner and commercial property disputes that were still ongoing.
After the success of such programs in states like Florida, Louisiana and Mississippi, the State of New Jersey had high hopes for the program. However, of the over 17,000 insurance claims that are still open and still unpaid in the area, only just under 500 have been filed under the mediation program, which began this past May. At only 2.8 percent of the total number of still-open claims, this number has surprised people like Ken Kobylowski, who is commissioner of New Jersey’s insurance department. "Very candidly, I thought the take-up would be a little higher than it is," he said.
Kobylowski blames a lack of public awareness as the main cause of the low numbers, but states that those who have taken advantage of the mediation program have walked away with an average of $114,000 for homeowner claims and $200,000 for commercial claims.
Despite these numbers, out of the 488 claims that have been sent to the mediation program for resolution, approximately half of those have not received a hearing date yet. New York, a state that also put into place a mediation program for Hurricane Sandy victims, has seen much more success with its program—a program that began only two months before New Jersey’s program. Out of 2,300 claims filed under New York’s jurisdiction, almost 1,800 have gone through a mediation hearing already.