But opponents argue that the more certainty insurers have, the less certainty homeowners have. "The insurer gains the benefit at the expense of the insured," says Ron Reitz, president of the National Association of Public Insurance Adjusters.

Reitz also rejects the argument that leaving ACC clauses in policies cuts costs for policyholders. "I do not see premiums being reduced with this reduction in coverage," he says.

Other critics of the ACC, like the Consumer Federation of America (CFA), argue that -- - legal or not - an ACC clause is "bad public policy" because it gives insurers a "trapdoor" to get out of offering the basic coverage that policyholders expect and paid for, says a study by Kimberly Myers at the University of Maryland.

The CFA has asked states to block ACC, but so far only California, West Virginia and Washington have restricted its use, says Myers.

Sandy follows Katrina

None of the states that limit use of ACC are among those pummeled last year by Superstorm Sandy, which cost $70 billion in damages, mostly in New York and New Jersey, and even left the III offices in the dark for almost a week. The III says that 93 percent of all claims from the October 2012 storm have been resolved with insurance payouts totaling almost $19 billion.

But there are a lot of dissatisfied customers. Insurers rejected thousands of business claims, says the New York Daily News, while USA Today reports "a growing number" of homeowners are seeking legal help.

Lawyers like Merlin say victims of Sandy might do better if they float the remains of their homes from New York to New Jersey. He and others representing clients in both jurisdictions say New York, which is home to many property-casualty insurers, tends to be a "conservative, insurance-friendly state" while New Jersey's judiciary is "consumer-friendly."