Until six months ago, Steve Kanstoroom hadn't given flood insurance asecond thought. But on Thursday, the retired consultant from Talbot County wassitting with the head of the federal flood insurance program in the lobby of asuburban Washington office tower, sharing insights into ways to prevent arepeat of the widespread problems with claims that followed Tropical StormIsabel.
The National Flood Insurance Program relies on such a complex interactionof private insurance carriers, adjusting firms and third-party administratorsthat, despite decades of experience by top NFIP officials, no one in theprogram fully understood all the nuances of how the system works, said FederalInsurance Administrator Anthony S. Lowe. But somehow, Lowe said, Kanstoroomhas put together the big picture in a way that others haven't.
In the process, Kanstoroom, who is pursuing a claim for his house inOxford, has become something of a folk hero to Isabel victims from Maryland toNorth Carolina. Working mostly behind the scenes, he has dug into themind-numbing details of obscure federal regulations and used them to prod theflood insurance program into what even the most despairing of Isabel victimsare starting to believe is a real chance for reform.
"He's part insider, part Deep Throat, and he showed 'em the smoking gun,"said Baltimore County Executive James T. Smith Jr., who sat in on some ofKanstoroom's meetings with the NFIP last week.
"As a former judge, I sat there watching this guy and thinking, `This guywould be the best lawyer who ever argued in front of me.' He was soorganized," Smith said. "I just sat there as their jaws dropped and dropped.It was almost surreal."
More than six months after the storm, hundreds of Isabel victims aredissatisfied with their insurance settlements, which many say are a fractionof what they need to rebuild. The government has offered some help - Gov.Robert L. Ehrlich Jr. is scheduled to sign a bill tomorrow offeringlow-interest loans, for example - but a constant refrain of Isabel victims isthat they don't want a handout. They say they just want what they believe theflood insurance program owes them.
Like many flood policyholders in Maryland, Kanstoroom and his neighborsfigured that their insurance would cover their losses from the storm. But hesays that when he and the elderly couple who live next door were offeredsettlements far below the costs to rebuild, he got upset.
Those who have studied the flood insurance problems Marylanders experiencedafter Isabel have found that many policyholders, along with insurance agentsand adjusters, lacked an understanding of what is covered and what is not.
Not so with Kanstoroom, a 46-year-old father of two who spent 20 yearsdesigning fraud detection systems for banks. He read the policy. He looked upthe manuals for private adjusters and the insurance companies that sell andservice flood policies. He investigated the contracts of the NFIP'ssubcontractors, bought a copy of the software program some adjusters use andpored over the federal laws and regulations that govern the program.
In the process, he uncovered what he saw as grave flaws in the system -subtle mechanisms that, in practice, prevented victims from getting what theydeserve.
"What motivated me to keep going was, the more I looked, the more I found,and the more concerned I became," Kanstoroom said. "And when I saw the levelof despair and hopelessness, I thought I couldn't not do it."
Many of the victims, advocates and officials who have met Kanstoroom duringthe flood insurance saga haven't known quite what to make of the frenetic manwith salt-and-pepper hair who seems constantly going in four directions atonce. Many said that at first blush, he sounded like a kook.
"Crazier than hell," said Marybeth Midgett, an advocate for Isabel victimsin North Carolina who came in contact with him last month. "But every time hementioned something, I would go on the Internet and start looking stuff up.Every piece of information he gave me checked out."
Kanstoroom contacted Bernice Myer, a victims' advocate whose Millers Islandhome was destroyed in the storm. He met with Maryland Insurance CommissionerAlfred W. Redmer Jr., former Commissioner Steven B. Larsen, Smith and Sen PaulS. Sarbanes' staff. He also talked with reporters.
He made contact with the NFIP but didn't get much of a response. Until lastweek.
On Tuesday, Redmer arranged a meeting for Lowe with a dozen of the mostdissatisfied Isabel victims in Maryland. Kanstoroom wasn't invited, but heshowed up anyway, and Redmer let him in the room.
All of the other flood victims in the meeting told their stories, but whenKanstoroom asked to speak, the moderator cut him off and said it was time fora coffee break, Myer said.
"The citizens said, 'Oh, no. You need to sit down because, so far, he's theclosest thing we've had to an answer in six months. We're not taking a coffeebreak,'" she said.
As Kanstoroom laid out some of the problems he found, Lowe seemedinterested, Myer said. The victims in the room were, too.
"It brought back hope to us," she said.
The NFIP officials invited Kanstoroom to speak with them. He brought Smith,and the two spent 5 1/2 hours with Lowe and his top deputies the next day.Lowe invited Kanstoroom to the summit Thursday in Falls Church, Va., and hespoke there, too.
After that session, Lowe talked to Kanstoroom for more than an hour aboutstrategies for improving the program and asking for copies of the regulationshe would need to read to understand the problems Kanstoroom found.
"Steve has done an excellent job," Lowe said.
After the summit ended Friday, Lowe, looking exhausted after two days ofmeetings and a hearing on Capitol Hill, plopped down in an armchair in theoffice tower's lobby. Once again, there was Kanstoroom, sitting opposite him.
Lowe talked for a few minutes about the summit, then Kanstoroom reachedinto a folder and pulled out a page of notes scribbled on the back of anagenda from the summit - his 10-point plan to fix the NFIP. Lowe called backone of his top deputies, and they sat and listened.
"Obviously, I'll be meeting with Steve again," Lowe said. "Monday morning,probably."