The federal flood insurance system is “stacked against homeowners” who try to file claims after disasters like Superstorm Sandy, Sen. Bob Menendez said Wednesday at a hearing where he confronted the head of the Federal Emergency Management Agency that runs the program.

FEMA Administrator Craig Fugate did not really argue, saying he was looking to improve the program and had asked the independent inspector general that oversees the agency to investigate some of the complaints Menendez had forwarded from storm victims.

Menendez said the insurance companies that are paid to service government-backed flood policies have “perverse” incentives to underpay claims, and that FEMA missed deadlines set by Congress to respond to appeals at the same time it was rejecting appeals when homeowners filed paperwork too late.

“Structurally, the system is stacked against policyholders,” Menendez, D-NJ, said at a meeting of the housing subcommittee that he chairs.

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