Nearly 16 months after Tropical Storm Isabel and its remnants wrecked their homes, 140 people from seven states, including Maryland, are demanding that officials responsible for settling their insurance claims pay what their flood policies call for or face a lawsuit alleging fraud in the National Flood Insurance Program.
Letters were sent last week on behalf of the families, many of them from Maryland, to "a sizable number" of entities involved in the claims process, including the Federal Emergency Management Agency and NFIP subcontractor Computer Sciences Corp., said Martin H. Freeman of the Rockville law firm Freeman & Freeman, who represents the families.
The letter is an effort to get immediate help through a settlement for Isabel victims, many of whom live in government-supplied trailers, without having to resort to lengthy and expensive lawsuits, he said.
Isabel victims in Maryland have long argued that they received far less than they were entitled to under their flood insurance policies.
"I want to get relief for these people as quickly as possible. It's really necessary for them and long overdue," Freeman said. "I felt it was more important to make one last genuine effort, a strong effort ... to get these people to where they can get on with their lives."
The letter follows a federal class action lawsuit filed last spring on behalf of thousands of Isabel victims and sets a deadline of Feb. 14 for reaching settlement without resorting to a lawsuit.
The quick turnaround is necessary because the statute of limitations for fraud claims will expire this summer, possibly sooner for some victims.
The letter seeks only to return the families to their "pre-flood condition" plus interest and attorney fees, but it says that a lawsuit alleging fraud, breach of contract and other claims would seek other damages.
The letter lays out information that it says points to a "conspiracy to commit fraud on a massive scale" and a resulting cover-up.
Information from Isabel victims, government and industry insiders, written and videotaped documentation and witness' accounts of adjuster training sessions show a discrepancy between what salespeople are trained to tell homeowners about their benefits and what adjusters are told to say later once a claim is filed, according to the letter.
Flood insurance is a federal program, but in the 1980s the National Flood Insurance Program created a system in which policies would be sold and serviced by private insurance companies.
Computer Sciences Corp. spokesman Chuck Taylor referred any comment about the letter to FEMA. James McIntyre, a FEMA spokesman, said agency officials will not comment until they have reviewed the letter.
Baltimore County Executive James T. Smith Jr. issued a news release yesterday detailing recent developments in efforts involving Isabel victims, including the letter on behalf of families and a letter Smith wrote to U.S. Sen. Barbara A. Mikulski that asks her to expedite a request from the county for nearly $1.4 million in FEMA grant money that would be used to elevate as many as 35 homes along the waterfront.
Maryland Insurance Commissioner Alfred W. Redmer Jr. said yesterday that his office plans to send a letter to Maryland's Isabel victims by the end of this week telling them about the warning letter.
"Obviously, we have to walk the fine line between providing service to the citizens of Maryland, but we're not in the position to endorse or recommend a specific action," he said.