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Flood home demolished, man fighting for insurance money

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BATON ROUGE - One man is at his wits end since he's virtually homeless after being told to tear down his house and the insurance company disagrees.

Paul Ortego says his insurance company told him his home was fixable, but Livingston Parish told him to tear it down. Now his pockets are empty and he doesn't know what to do.

A large pile of dirt sits where Ortego's home once stood. He tore down the house he's lived in for 18 years after it was deemed irreparable and uninhabitable by Livingston Parish. In a November 2016 letter from Livingston Parish Floodplain Administrator Chuck Vincent, it says the owners are allowed to apply for the Increase Cost of Compliance claim. It also says after inspection, Ortego’s home should be condemned and demolished.

During the August 2016 flood, Ortego got two feet of water in his house after it was set up about three feet off the ground. FEMA paperwork states the water moved the house from its foundation and was unsafe to enter. Ortego says the floors caved in and the house was pushed by the rushing water.

He says his insurance adjuster disagreed with the report, thinking the house could be fixed. Allstate visited the home three times to evaluate the damage and after some back and forth cut Ortego checks totaling about $86,000.

"They says the damage wasn't that extensive and it didn't need to be rebuilt, it was repairable," he said.

He took that money and other funds he'd saved up to pay off the mortgage and per instruction tore the house down.

Ortego's property is insured for $245,000. After paying 18 years for insurance, he doesn't think the amount he was issued is fair.

"We did what we had to do as responsible adults to protect ourselves and at the end of the day, we're worse off than the ones that didn't have nothing," he said.

The clock is ticking for Ortego who has to be out of his FEMA-issued Manufactured Housing Unit in three months.

He's stuck staring at a pile of dirt until his cry for help is answered.

Ortego says he plans to file an appeal with FEMA Monday morning. Allstate tells 2 On Your Side he must appeal to FEMA.

In a statement provided to WBRZ Allstate says, "In the wake of a catastrophe, our top priority is to help customers through the claims process so they can get back on their feet as soon as possible. Allstate has no incentive to pay its customers anything less than what is owed. Such an allegation reflects a fundamental misunderstanding of how WYO carriers are compensated for administering NFIP claims on behalf of FEMA. Insurers participating in the NFIP receive compensation for handling flood claims based on the size of the payout. In other words, the higher the claim settlement amount, the higher the claim adjusting compensation for the insurance company – there is no incentive to underpay the amount of any NFIP claim."

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