Homeowners insured through the National Flood Insurance Program who think they were shortchanged for Superstorm Sandy damage could receive a letter as early as this week asking them if they want to reopen their claims so that they can be re-examined.

A home destroyed by Sandy in Mantoloking, NJ (Photo by Mark Wilson/Getty Images)

The move was announced on March 11 by Federal Emergency Management Agency (FEMA) Administrator Craig Fugate after reports surfaced that Sandy flood insurance claims may have been improperly denied or reduced due to fraudulently altered insurance inspection reports. The announcement was made after Fugate met with U.S. Senators Robert Menendez and Corey Booker of New Jersey and Charles Schumer and Kristen Gillibrand of New York.

The letters, which are scheduled to start being mailed out on Monday, will be distributed to nearly 142,000 policyholders in batches by ZIP codes over the course of several weeks.

U.S. Rep. Chris Smith said those that receive letters will have 90 days from the date of the notice to contact FEMA to begin the review process.

“The revised plan includes a full review of each claim one-by-one with fresh eyes, the use of the homeowner’s evidence of an underpayment as the basis for a final determination, and the option of a third-party neutral review,” Smith said in an emailed press release on May 6.
What happens if a homeowner decides to contact FEMA?

"FEMA will reach out to the insurance companies that were carrying their flood insurance. They will make sure all the documentation is available to the individual as well as FEMA," Menendez said.

After that an independent review of the situation will be completed.

"These are going to be reviewed by a whole new group of adjusters that are going to be hired. The best of the best in the industry - further trained by FEMA to go through these," Menendez said, "With the goal hopefully being a rather simple, transparent process that in most cases would produce a result within 30 days after that filing takes place."

Menendez said the aim is to expedite the process so that people who have already been waiting more than two years, don't have to wait much longer.

If homeowners are not satisfied with the result of the review, Menendez said a follow-up option will be made available.

"There is going to be an independent group of non-FEMA (workers) - former judges and others, law professors, who are going to make a final determination and give that recommendation to FEMA," Menendez said.

He added that he hopes this will finally end the claim nightmare for some victims.

"I think we've got a process here that hopefully can create justice for a lot of Sandy victims, get them the money they deserve and bring this to a successful conclusion."

The Associated Press contributed to this story.