According to Florida-based public adjustment firm Tutwiler & Associates, some Sandy victims experienced foundation damage due to their homes wallowing in four or more feet of water, with each gallon applying eight pounds of pressure onto concrete slabs.

Cuomo promised that the state will be responsible for bridging the "unfair gap in coverage." Questions to the governor's office regarding the program's cost and source of funding were not answered.

"There are engineering designs that can lessen the likelihood or severity of this problem, but earth movement it not all that common relative to the types of claims usually experienced in floods," says Robert Hartwig, president of the Insurance Information Institute (I.I.I.), in an email to PC360 confirming that earth movement is a common exclusion in homeowners and commercial-insurance policies.

"Like you, I've not come across too many details [of the program]—including how this will be funded," says Hartwig, who adds that the state's decision to pay uninsured losses is "an entirely political one."

In addition to the housing-recovery program, The Office of Storm Recovery, which Cuomo created in June 2013, will work with communities to determine how resiliency measures can help prevent future damage from earth movement.

In April, the U.S. Department of Housing and Urban Development (HUD) and New York State allocated $1.7 billion of federal disaster funds towards housing, infrastructure and business recovery in communities affected by Hurricane Sandy.