Narragansett Bay Insurance Company Ordered to Pay $327,400 Fine

Narragansett Bay Insurance Company (NBIC) was ordered to pay a $327,400 penalty for failing to perform timely inspections of Superstorm Sandy damage claims as required by New York Insurance Law and regulations.

The company’s violations were uncovered as part of a New York State Department of Financial Services (DFS) investigation.

DFS initiated its investigation into NBIC in 2013 after policyholders complained of being unable to reach adjusters, as well as adjusters failing to show up to scheduled appointments.

The DFS investigation uncovered numerous instances where adjuster inspections of damage related to Superstorm Sandy were not performed in the time frames required by law and regulation.

The agreement with DFS also stipulates the company must, within 60 days, improve its systems and procedures to ensure that it can successfully process policyholders’ catastrophe claims within the legally required time frames. The agreement, made public, requires NBIC to commit to the following:

NBIC responded to the announcement by Gov. Cuomo’s announcement by issuing a statement indicating that while it did not agree with the DFS findings, it found it to be in the best interest of the company to accept their conclusion.

NBIC further stated that it was not cited for incorrectly denying, delaying payment or underpaying any claims indicating that “More than 95 percent of the claims filed were closed within 120 days.”

In addition, the statement indicated of the more than 20,000 claims related to Superstorm Sandy the company handled, only 244 complaints were reported to DFS. In addition, 67 of those complaints were specifically related to flood coverage. The company stated it does not provide or write flood insurance coverage.

Sources: New York DFS and NBIC