The Business of Disaster

After Hurricane Sandy struck the New Jersey and New York coastlines in 2012, President Obama visited residents with assurances that bureaucratic red tape would be cut to make every effort to get people back in their homes. Yet almost four years later, many still live in rental units, and houses are either boarded up or gone altogether. Simultaneously, many insurance companies are making record profits. What happened? National Public Radio reporter Laura Sullivan hosts this PBS-aired Frontline documentary by Rick Young, which looks at the troubled web that exists involving insurance companies, flood insurance coverage, and government bureaucracy. Insurance companies have been traditionally wary of covering floods, but after big flood disasters in the 1960s and ‘70s, Congress stepped in with a large government-backed insurance program. But after Hurricane Katrina struck New Orleans in 2005, FEMA almost went bankrupt. Under pressure to keep payments down, companies denied claims or systematically underpaid, often claiming pre-existing conditions such as "earth movement" cracks in house foundations. The Business of Disaster illustrates how insurance contracts can be impenetrable collections of loopholes and exclusions that are written in convoluted English. Many times it seems as if only lawyers and contractors get paid, not policyholders, as paperwork mysteriously vanishes, engineers' findings are arbitrarily changed, and unqualified people are hired to perform inspections and prepare reports. In efforts to attain neighborhood "resiliency," houses have been elevated, resulting in odd-looking ad hoc streets. As authorities fumble toward solutions, people remain out of their houses and insurance companies continue to profit from their misery. With climate change offering a harbinger of worse to come, this is a timely documentary. Recommended. Aud: C, P. (S. Rees)