New Jersey residents who are still dealing with unresolved insurance disputes resulting from last year’s Hurricane Sandy can now submit their claim to the American Arbitration Association and have it mediated.  All mediation proceedings will be, by law, paid for by the insurance company carrying the policy.  This program is one of several that have been initiated throughout the Northeast to help homeowners and insurance companies reach a resolution on unresolved claims and unrepaired property damage. 

Mediating insurance claim disputes following a natural disaster has proven to be an effective and highly successful way to deal with the enormous influx of claims that arise in the wake of such events.  Mediation is less costly than litigation and is a less formal process, making it an enticing solution to both insurers and claimants who have had their claims denied by their insurance carriers.

Ken Kobylowski, Commissioner of the New Jersey Department of Banking and Insurance, has heralded the success of mediation to handle such disputes thus far. "This program represents another option consumers have to resolve disputes with their insurance companies regarding the coverage provided by their policies or the size of claim payments."

While there are some claims not eligible for the program (for example, flood claims), as long as the dispute is with a standard insurance company (rather than a surplus line carrier), is an amount more than $1,000 and is not at risk for being suspected of fraud, it can be included.  The state is working to also allow flood claims to be mediated, as well.