The National Flood Insurance Program is not Insurance but is a Government Entity
Post 5235
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A Suit Against the NFPA Must be Filed in Federal Court
In Brian Bevel v. Federal Emergency Management Agency (FEMA) , United States District Court, Middle District of Florida, 8:25-cv-02159-JLB-CPT (November 21, 2025)Judge: John L. Badalamenti resolved the dispute over insurance coverage..
Key Facts
Parties and Claim:
Plaintiff Brian Bevel sued FEMA for breach of an insurance contract under the National Flood Insurance Program (NFIP). The policy insured Bevel’s property in Longboat Key, Florida, against flood damage.
Incident: The property sustained damage on September 26, 2024. Bevel notified FEMA, which investigated but allegedly failed to adjust the loss per policy terms, constituting a material breach.
Procedural History:
Bevel filed the breach-of-contract suit in Florida state circuit court on May 6, 2025, seeking damages exceeding $50,000. FEMA removed the case to federal court on grounds of federal officer removal under 28 U.S.C. § 1442(a)(1).
FEMA moved to dismiss under Fed. R. Civ. P. 12(b)(1) for lack of subject-matter jurisdiction, citing derivative jurisdiction and sovereign immunity. Bevel failed to timely respond; the court ordered a response (Doc. 20), which was filed late (Doc. 21) but accepted in the court’s discretion.
Bevel’s Response Arguments (Rejected):
FEMA, as the removing party, should not seek dismissal. Independent jurisdiction exists under 42 U.S.C. §§ 4071–4072 (NFIP claims) or 28 U.S.C. § 1332 (diversity). Dismissal would waste resources, as Bevel could refile in federal court.
Relevant Law and Analysis
The court’s decision hinges on federal courts’ limited jurisdiction and the requirement to resolve jurisdictional issues first. The motion was treated as a factual attack under Rule 12(b)(1), allowing consideration of matters outside the pleadings. Burden to establish jurisdiction rests with the plaintiff. Dismissals for lack of jurisdiction are without prejudice.
Core Doctrines Applied
Federal jurisdiction over a removed case derives from the state court’s initial jurisdiction. If the state court lacked subject-matter jurisdiction, the federal court acquires none upon removal, even if it would have had original jurisdiction.
Florida state court lacked jurisdiction over Bevel’s NFIP breach claim, as 42 U.S.C. § 4072 vests “original exclusive jurisdiction” in the federal district court where the property is located. Bevel’s policy was issued under § 4071 (NFIP claims).
Statutory Framework
42 U.S.C. § 4071:
Authorizes issuance of Standard Flood Insurance Policies (SFIPs) by FEMA (or Write Your Own program insurers).
42 U.S.C. § 4072:
Grants federal district courts “original exclusive jurisdiction” over suits by policyholders against FEMA for disallowed claims or breach. Venue is proper in the district where the insured property is located.
28 U.S.C. § 1442(a)(1):
Allows removal by federal officers/agents acting under federal law (FEMA qualified). However, derivative jurisdiction still applies.
28 U.S.C. § 1332:
Diversity jurisdiction argued by Bevel but irrelevant due to derivative doctrine; NFIP claims are statutorily exclusive to federal question jurisdiction.
Plaintiff’s Arguments and Rebuttals
FEMA’s Removal as Estoppel:
Rejected; FEMA can seek dismissal in federal court even after removal, as it could have in state court based on § 4072.
Efficiency/Waste:
Dismissal without prejudice allows refiling in proper federal court; plaintiff “filed in the wrong court” and must comply with § 4072.
Implications
This order underscores the strict enforcement of exclusive federal jurisdiction for NFIP claims, preventing “forum shopping” via state filings followed by removal.
Plaintiffs must file directly in federal court to avoid derivative jurisdiction pitfalls. Sovereign immunity further insulates FEMA from state-court suits.
Bevel retains the right to refile in the U.S. District Court for the Middle District of Florida.
Outcome
FEMA’s Motion to Dismiss was granted; Plaintiff’s Complaint was dismissed without prejudice for lack of subject-matter jurisdiction and Plaintiff may refile in the proper federal court.
ZALMA OPINION
FEMA is not an insurance company. It is a federal government agency that provides to people in flood zones indemnity to those who pay for the protection. It is not insurance. By its creation as a federal agency suits against FEMA can only be brought in federal courts. The Plaintiff attempted to avoid federal court by filing in state court only to have FEMA remove the case to a federal court where it was dismissed for lack of jurisdiction.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Time Bar Defeats Suits Against Insurer
Post 5247
Read the full article at https://lnkd.in/gupyuD33, see the video at https://lnkd.in/gSV8kf8S and at https://lnkd.in/gBrxCRDt, and at https://zalma.com/blog plus more than 5200 posts.
In Kevin J. Labudde v. The Phoenix Insurance Company, No. 7:21-CV-197-BO-BM, United States District Court, E.D. North Carolina, Southern Division (December 12, 2025) Defendant The Phoenix Insurance Company (Phoenix) moved for summary judgment, moved to exclude the testimony of Donald Dinsmore and Jerome Redmond, and moved to seal certain documents.
FACTS
Kevin J. Labudde’s home was damaged by Hurricane Matthew on October 8, 2016. He discovered additional mold damage in January 2017 and hired a contractor, who filed an insurance claim with Phoenix Insurance Company. Phoenix found hail damage (covered by the policy) but determined the cost was below the deductible and denied coverage for water intrusion and mold, citing policy exclusions for seepage.
Second Claim:
On December 13, 2019, water again ...
CVS Settles Fraud Allegations with the US, Multiple States & Cities
Post 5246
Read the full article at https://lnkd.in/gWPTErTV, see the video at https://lnkd.in/gcmb4USM and at https://lnkd.in/gZcEHcZ9, and at https://zalma.com/blog plus more than 5200 posts.
False Claims Act Claims Resolved by CVS
In United States Of America v. CVS Pharmacy, Inc. et al, Nos. 18 Civ. 3047 (JGK), 19 Civ. 1550 (JGK), 19 Civ. 8454 (JGK), 19 Civ. 11244 (JGK), 20 Civ. 2173 (JGK), 18 Civ. 3047 (JGK), United States District Court, S.D. New York (December 1, 2025) Honolable John G. Koeltl United States District Judge concluded that Relators filed the above-captioned multiple actions against defendant CVS Pharmacy, Inc. (“CVS”) and other entities on behalf of the United States under the qui tam provisions of the False Claims Act, 31 U.S.C. § 3729 et seq., on behalf of 30 states, the District of Columbia, Puerto Rico, and the Virgin Islands under comparable state false claims and insurance fraud laws, and on behalf of six ...
CVS Settles Fraud Allegations with the US, Multiple States & Cities
Post 5246
Read the full article at https://lnkd.in/gWPTErTV, see the video at https://lnkd.in/gcmb4USM and at https://lnkd.in/gZcEHcZ9, and at https://zalma.com/blog plus more than 5200 posts.
False Claims Act Claims Resolved by CVS
In United States Of America v. CVS Pharmacy, Inc. et al, Nos. 18 Civ. 3047 (JGK), 19 Civ. 1550 (JGK), 19 Civ. 8454 (JGK), 19 Civ. 11244 (JGK), 20 Civ. 2173 (JGK), 18 Civ. 3047 (JGK), United States District Court, S.D. New York (December 1, 2025) Honolable John G. Koeltl United States District Judge concluded that Relators filed the above-captioned multiple actions against defendant CVS Pharmacy, Inc. (“CVS”) and other entities on behalf of the United States under the qui tam provisions of the False Claims Act, 31 U.S.C. § 3729 et seq., on behalf of 30 states, the District of Columbia, Puerto Rico, and the Virgin Islands under comparable state false claims and insurance fraud laws, and on behalf of six ...
Zalma’s Insurance Fraud Letter
Read the full article at https://lnkd.in/dG829BF6; see the video at https://lnkd.in/dyCggZMZ and at https://lnkd.in/d6a9QdDd.
ZIFL Volume 29, Issue 24
Subscribe to the e-mail Version of ZIFL, it’s Free! https://visitor.r20.constantcontact.com/manage/optin?v=001Gb86hroKqEYVdo-PWnMUkcitKvwMc3HNWiyrn6jw8ERzpnmgU_oNjTrm1U1YGZ7_ay4AZ7_mCLQBKsXokYWFyD_Xo_zMFYUMovVTCgTAs7liC1eR4LsDBrk2zBNDMBPp7Bq0VeAA-SNvk6xgrgl8dNR0BjCMTm_gE7bAycDEHwRXFAoyVjSABkXPPaG2Jb3SEvkeZXRXPDs%3D
Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/
Zalma’s Insurance Fraud Letter
Merry Christmas & Happy Hannukah
Read the following Articles from the December 15, 2025 issue:
Read the full 19 page issue of ZIFL at ...
The Professional Claims Handler
Post 5219
Posted on October 31, 2025 by Barry Zalma
An Insurance claims professionals should be a person who:
Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
Understand how to repair damage to real and personal property and the value of the repairs or the property.
Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
How to Create Claims Professionals
To avoid fraudulent claims, claims of breach of contract, bad faith, punitive damages, unresolved losses, and to make a profit, insurers ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
