Flood Insurance Delay Paints Bleak Picture for Sandy Victims

His wife leaves the room to tend to their youngest. Jim Racanelli talks about being a man, about the responsibility of providing emotional and financial stability for his family. His icy-blue eyes are stern and unblinking, but when he talks his voice wobbles a bit, like the legs of a man shouldering a burden that’s suddenly grown too large to carry.

Driven from his home by Hurricane Sandy, Racanelli stands among the ruin. The walls of his Toms River home are stripped up to his waist, electrical lines like exposed nerves. The foundation is cracked, the house and its upside down mortgage shifted. You want to be strong, he says standing in the middle of a warped and rotting floor, but there’s always a limit.

If he hasn’t reached it yet he’s certainly knocking on the door.

In New Jersey, thousands of families are still displaced with little indication of when and if they’ll be able to return to their pre-Sandy lives. They are hoping their insurance can make them whole again by providing the funding necessary to make repairs and raise their homes, but the process is proving to be a slow one. As the winter creeps on, the future of many of those who’ve lost their homes to Sandy remains uncertain. 

“I’m trying to keep my head my head up. I’ve always said things will be OK; everything will be all right. This time I’m not so sure,” Racanelli said. “I feel hopeless and helpless at the same time. To feel like that when you’re usually in control, it’s just people are looking to me ... my family is looking to me.”

Displaced and Homeless

The Racanelli’s have spent the last three months as nomads. The five of them, Racanelli, his wife Bel, and their three children ages 9, 7, and the youngest 3, have moved from place to place after being displaced from their home.

They had relatively comfortable accommodations in a hotel for a time but were tossed out, victims of overbooking and a reservation made with a credit card.

It hasn’t been easy for the kids, he says. The oldest has withdrawn. He’s sick of talking about the hurricane. Their middle son is acting out in school. He’s on edge. Administrators think it might be the result of the accumulated stress of seeing the only home he’s ever known destroyed. Racanelli said he knows it is.

On a trip to the mall during the holiday shopping season – a short-lived diversion for the children, a stark reminder to the parents of the loss of all their accumulated possessions – Racenelli said his daughter sat on Santa Claus’s lap. When he asked her what she wanted for Christmas, she told him she wanted her house back.

In their odyssey they spent a week in a neighbor’s camper, parked in their driveway and emerging only at night, after their hosts had gone to bed, to use the bathroom and take hot showers.

Looking for a house to rent for a longer, but still temporary solution, they found few available options for their family, despite assurances from the state and the Federal Emergency Management Agency that New Jersey has more than enough rental properties available for Sandy victims.

Eventually, after initially being denied rental assistance by FEMA without explanation and reapplying and being told that, yes, they did qualify for assistance, the Racenelli’s found a suitable home, agreeing to terms with a landlord. After several unanswered phone calls from Racanelli, he found out the property was leased to another family, he believes, with better connections or maybe a bit more cash.

A bright spot emerged recently in the form of an online connection via social media. A long ago high school friend, maybe better stated, an acquaintance, caught wind of Racanelli’s plight on Facebook. She offered him the name and number of a couple who spend their summers in Point Pleasant. This time the promise of an available rental home came through.

It’s home, for now.

Everything is temporary, of course, until their house is rebuilt, torn down, built over, raised up or swallowed by surging tidal waters during the next once a century storm. Racanelli said he isn’t sure what to do or how long the process will take. He hasn’t gotten his insurance check yet. The work that’s been done in the house so far – the stripping of the floor and walls and the debris removal – was done by a contractor who expects to be paid, eventually. Their life in disarray, the Racanellis, beaten down and frustrated, can only wait.

Unprecedented Storm, Unprecedented Delays  

On a tour of the barrier island at the end of November, a month after the storm decimated much of the Jersey Shore and the first time the state Assembly at large was given the opportunity to see the devastation, Assembly Speaker Sheila Oliver walked along a road where houses once stood and stated, confidently, that the state would be there to aid in recovery.

Insurance companies should take notice, too, she promised. The state would not look kindly on insurance companies that delayed writing checks to displaced homeowners. Never mentioned, however, as she continued along, stopping for a moment to survey an Ortley Beach home crumbled on top of a pile of sand that didn’t belong there, was FEMA’s role in the payback.  

The federal agency operates the National Flood Insurance Program, which is in the process of making good on the policies Sandy’s victims have been paying into for years. But in many instances, the payouts have not come quickly enough. Even now, nearly three months since the storm passed, some residents, like the Racanellis, are still waiting for their checks. Homeowners are eager to get back to work, to begin rebuilding their lives, but without money there’s little they can do.

FEMA has asserted its position as the helping hand during Sandy recovery, offering displaced families assistance in finding rental properties, providing funding to pay for rent, and even supplying temporary housing at previously unused facilities at Fort Monmouth and in the form of mobile homes driven into New Jersey on 18-wheelers and dropped on concrete slabs in trailer parks throughout the area. Help is here, but it might not be in the form residents are looking for. The shear total of claims, the lengthy process through which FEMA assesses damage, has meant a delay in insurance payouts, officials said.

“It’s taking a little bit of time because of the inordinate amount of claims,” FEMA Spokesman Christopher Mckniff said recently, noting that hundreds of thousands of claims have been submitted in New York and New Jersey. “It’s taken its toll on the system because it was such a catastrophic event.

“If you’re having an issue, if you’re waiting a long time on insurance, there are things we can do to assist you.”

"This is your job. Let's go here." 

Typically, insurance companies have 30 days to respond to claims. When it comes to unprecedented storms, like Sandy, that deadline is suspended. How long the suspension lasts depends on a number of factors, including the number of claims submitted, the personnel needed to assess damage, and having funding available in your coffers.

Earlier this month and prior to the passing of a complete Sandy relief package, the U.S. House of Representatives approved a measure to allow the National Flood Insurance Program to borrow $9.7 billion to pay insurance claims made by Sandy victims. In all, Sandy damaged or destroyed nearly 350,000 homes throughout the state. According to statistics released by Gov. Chris Christie’s office, 72,000 of them were covered by the NFIP.

Among them is the Racanelli home.

“The insurance companies are crying, asking people to be patient, but we’re 10 weeks out here,” Bel Racanelli said. “I understand you’re overwhelmed, but you’re paid to do this. This is your job, let’s go here. Let’s hire people, let’s get off our butts and get this done.”

Racanelli’s words are earnest and delivered so. In the past few years, the 31-year-old has raised her children while having to deal with multiple surgeries, a home fire that destroyed many of her family’s personal belongings, and the strain of a cancer scare that caused her son to be admitted to the hospital. But the weary look that weighs on her still youthful face has everything to do with Sandy.

Information on what to expect has been limited. Jim Racanelli said two different adjusters came to take a look at his property on two different days. They each had significantly different opinions and perspectives on the situation. As to the official word, Racanelli doesn’t know. The adjusters have taken a look at the property, filled out paperwork, and submitted it up the line. In the mean time all there is to do is wait.

The Department of Banking and Insurance has taken on the task of assisting the state’s residents when it comes to filing complaints, answering questions, or, as it’s been recently, serving as the vent for so many Sandy-related concerns. Despite delays, DOBI Spokesman Marshall McKnight said claims are being paid off and that legitimate complaints, those that include proof that insurance companies violated department regulations, have been few.

In all, approximately 488,000 Sandy-related claims have been submitted by residents since the October storm. Of that total, 300,000, or roughly 60 percent of all claims, have been closed, paid out, resolved. When it comes to homeowners insurance, DOBI has methods of applying pressure to help urge things along. Dealing with the National Flood Insurance Program is a bit different. It’s a federal issue and not part of the department’s jurisdiction. Helpful advice is available, but getting your claim answered is out of the state’s hands.

Unsurprisingly, perhaps, the majority of complains DOBI has received following Hurricane Sandy are specifically related to flood insurance and delays in insurance payouts, McKnight said.

An Uncertain Future 

The Racanelli’s home on Elizabeth Avenue is a 1920’s bungalow with a view of a lagoon that’s never even once risen to reach their property line. In the distance, past the reeds and marsh are a few scattered mansions – new construction taking advantage of a natural vista – in a crowded part of a crowded state that’s likely unattainable for blue-collar families. 

They haven’t built homes like these for years and they may never again. They’re small, built below grade, and now, thanks to Sandy and FEMA’s new flood elevation maps, are located in flood prone areas. Even if the Racanelli’s are able to rebuild their existing home, new flood insurance rates expected to come online next year will make it too expensive to live there. Raising it is an option, one Racanelli said he’ll pursue, but Increased Cost of Compliance, or ICC, coverage only provides a maximum of $30,000 to raise a structure. Racanelli said he’s gotten estimates, the lowest of them coming in at $40,000.

In the end, the point may be moot. The ICC funding requires a number of steps before it’s made available, including compliance from towns to follow FEMA’s new flood maps. Even then the money doesn’t come quickly. At a recent information session with Sea Bright residents, FEMA officials acknowledged that some property owners in the Gulf Coast still haven’t received ICC funding to elevate their homes after Hurricane Katrina, a storm that hit in 2005.

“A lot of the builders are saying ‘Jim, by the time we repair this all it’s going to cost too much’,” Racanelli said. “I don’t know what to do.”

You can find more articles from this ongoing series, “Dispatches: The Changing American Dream” from across the country at The Huffington Post.