Feds target overseer of $1B 9/11 insurance fund fighting claims

http://www.nydailynews.com/news/2007...insurance.html

BY LEO STANDORA
DAILY NEWS STAFF WRITER
Tuesday, December 4th 2007, 4:00 AM

WASHINGTON - Federal officials want to know why the overseer of a $1 billion Sept. 11 insurance fund created to cover claims of sick Ground Zero workers is fighting every case rather than giving money to those who clearly deserve it.

They said Monday they'll investigate the World Trade Center Captive Insurance Co., which has taken roughly 8,000 claims into the federal courts

Homeland Security Department inspector general Richard Skinner said his probe will determine why the company "has chosen to litigate all claims instead of settling whenever possible."

Documents sent to Congress and due to be released later this week say the review also will determine "what procedures have been established to receive, review and pay medical, hospital, surgical and disability benefits to injured persons," as well as benefits to the relatives of those killed.

The insurance company has also been challenged by Sens. Patrick Leahy (D-Vt.) and Arlen Specter (R-Pa.), the chairman of and ranking Republican on the Senate Judiciary Committee.

The controversy has put lawyers for New York City on the defensive, because the city and some construction contractors are protected by the program.

City Corporation Counsel Michael Cardozo has defended the company as "an insurance company, not a compensation fund," and argued that as such, it is obliged to defend legal claims.

Meanwhile, Mayor Bloomberg is urging Congress to redirect the insurance company money to create a new compensation fund for workers sickened by dust, fumes and debris at Ground Zero and give the city and the contractors immunity from such lawsuits.

A spokeswoman for the city's Law Department did not immediately respond to a request for comment Monday.

The company issued a statement saying it was cooperating with the inquiry and welcomes the review.