Legislators, homeowners question whether flood insurance loophole should be addressed

TAMPA, Fla. (WFLA) — Our Better Call Behnken investigation has discovered the federal government can deny your flood insurance claim, even when you did everything right.

We are continuing to push for answers about a loophole that could cause your National Flood Insurance Policy to be worthless when you need it.

A Pinellas County family thought they were protected with a $8,600 flood policy through the program, which is administered through FEMA, but after their home was flooded by Tropical Storm Debby, their claim was denied.

The family said FEMA cited prior loss on the property that the previous homeowner collected on but did not repair.

Homeowner Danielle Jensen said she feels she was sold a worthless policy.

"He told me that he had received the prior loss report," Jensen said, explaining what her insurance adjuster told her. "He looked at it, and it was the worst case scenario and that from the prior loss report, from the pictures, it was clear that the house was in the exact same state when he viewed it."

Now, her family is on their own, forking over tens of thousands of dollars to repair their home, and now they won't get reimbursed.

"Even down to the appliances that have the same serial number from the prior loss claim," she said.

What's happening to Jensen's family could happen to anyone buying a national flood policy.

There was no public record to check to see if there was prior damage that wasn't repaired.

Still, the family was sold the expensive policy.

"It's worthless, unless we flood again after we've made all these repairs at which point we could use it because it's all new materials," she said, noting she would not have bought the property had she known about the unrepaired damage or FEMA's policy.

Jensen said FEMA told her they don't require policy holders prove they made the repairs.

That leaves her questioning why she was sold this policy in the first place.

FEMA confirmed to Better Call Behnken that it does not require policy holders prove they made repairs, and new homeowners can't check to make sure they did.

FEMA has issued over 1.7 million NFIP policies in Florida, with more than $400 billion in total coverage. There's no way to know how many of those policyholders would be denied damages because of unrepaired prior loss claims, just like Jensen's.

Better Call Behnken reached out to Congressman Gus Bilirakis, R-Florida's 12th District, and Congressman Kathy Castor, D-Florida's 14th District.

"It is important that consumers have full transparency when making decisions about homeownership and what is covered when federal flood insurance policies are purchased," Bilirakis said. "I'm committed to maximizing transparency and strengthening disclosure requirements while serving as a good steward of taxpayer resources. We've got to prevent catastrophic situations, like this one, from occurring again in the future."

"Flood insurance is increasingly important to Floridians as flooding becomes more frequent and unpredictable due to the heating climate and more intense weather events," Castor said. "In Congress, I am working on bipartisan solutions to lower the cost of flood insurance through greater competition to bring rates down. The State of Florida finally passed a law recently that requires sellers to disclose prior flooding events to new homeowners. My team and I are here to help get answers regarding denied claims and cut through red tape. Please contact me if your claim has been denied or you are experiencing any other challenges with the National Flood Insurance Program."