Judge: Insurance policy excluded flood damage (Katrina)

[Contrary1]

GULFPORT, Miss. - A federal judge ruled Tuesday that an insurance company’s policies do not cover damage from flood waters or storm surge in a decision that could affect hundreds of upcoming cases related to property damage from Hurricane Katrina.

U.S. District Judge L.T. Senter Jr. ruled that a Mississippi Gulf Coast couple cannot collect damages from storm surge caused by Katrina because Nationwide Mutual Insurance Co.’s policies do not cover wind-driven water damage.

Senter Jr. said Paul and Julie Leonard of Pascagoula could be compensated for damage that they could prove was caused by high winds, however.

“Almost all the damage to the Leonard residence is attributable to the incursion of water,” Senter wrote in the 13-page decision.

Senter’s ruling could set a precedent for hundreds of other court challenges to the insurance industry for denying billions of dollars in claims after the Aug. 29 hurricane ravaged the coasts of Louisiana and Mississippi.

http://www.msnbc.msn.com/id/14362386/


On edit: Looks like the good judge changed his mind:

May 25, 2006

"GULFPORT, Miss. (AP) - Provisions in a State Farm Fire & Casualty Co. policy that excludes certain damage from Hurricane Katrina are unenforceable, a federal judge in Mississippi has ruled.

A couple whose Long Beach home was damaged by the Aug. 29 storm is suing State Farm for denying their claim, arguing that the wording of their policy's "flood exclusions" are ambiguous and cannot be enforced.

U.S. District Judge L.T. Senter Jr., in a ruling released Wednesday, said the terms of State Farm's policy was unclear and ambiguous in excluding damage from "tidal waters," which inundated thousands of homes when Katrina pushed ashore from the Mississippi Sound.

http://www.newschannel5.tv/News/Other/3042/

[whistle]

1. Insurance companies and federal judges all a bunch of crooks

...In Florida Jeb Bush back in early 2004 to appease the insurance companies forced through legislation that allowed from 2% to as much as 10% hurricane deductible of the insured value of your home, not of the claim amount. In effect a house insured for $150,000 could have a hurricane duct able of from $3,000 to $15,000 as stated in the policy. The homeowner must furnish that amount first before any damages are covered.

[MrCoffee]

2. This is gonna get UGLY.

[pitohui]

3. yes it is

unfortunately i don't think the ruling is a surprise

[KamaAina]

4. We're on top of it in LBN as well

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=2457929&mesg_id=2457929

Reminds me of what a dear friend used to say about the insurance industry. "You've got -- peace of mind! We won't actually pay you anything if something bad happens, but in the meantime -- you've got peace of mind!"

[stillcool]

5. The Mafia provides better protection...

than insurance company's. Back in May, the house we rented was totally flooded. We were evacuated, and were so sure our little old renter's insurance would at least help pay the motel bill. Nada.

[AndyA]

6. Just another reason to hate the Republicans. Their big business friendly

focus is allowing the insurance companies to get away with murder, and leaving a lot of people who have no home, and no way to rebuild their home.

I wonder how much damage those houses would have suffered if the WIND hadn't first damaged them and left them WIDE OPEN to the rain and flooding? Once the structural integrity has been breached, it takes less to cause greater damage.

[pitohui]

9. well that's the thing

many of these houses in coastal mississippi, were completely swept away down to the slab by the storm surge

it is the difficulty of providing any proof of wind damage that is the issue

by comparison a friend's house was destroyed by levee breach in lakeview, but there was no storm surge powerful enough to sweep the house away, the homeowner's insurance found a tree on the house and was able to give him some money at least for the tree damage -- it was a few thousand dollars which helps plug the holes in his flood insurance, since flood has high deductibles

even worse in mississippi many people were told they didn't need flood insurance by lazy agents who didn't want to fill out the extra form, since there is little profit for the insurer in selling flood insurance as it's a national program

in the mississippi situation a lot of people can't prove there was wind damage before the flood damage because literally nothing remains but a slab -- it is just horrific beyond belief

[Common Sense Party]

7. READ YOUR POLICIES!!! Check the fine print!

This is not to be harsh. It's meant to be helpful. Most people have NO IDEA what their insurance policy actually covers.

Yes, the policy is gobbledy gook. Sit down with your agent and force her to explain it to you in plain English.

Many people do not understand that their homeowners policies do not cover certain floods, or earthquakes, etc. Some of those require separate policies or riders.

[politicat]

8. When dealing w/ insurance companies, it pays to read the fine print FIRST.

Flood insurance is generally separate from wind, fire and AoG damage. The best thing a homeowner can do when dealing with insurance is to READ the POLICY as soon as s/he gets it and a) get the insurance company to define in writing any ambiguous clauses, and b) think about worst case scenarios and make sure they're covered. It's a smart consumer practice.

Third thing is to make sure that copies of policies are stored in places other than at home, preferably far away with a trusted friend or relative. My sister and my mother both have CD-ROMS with scans of all of our important documents, as well as spare copies of birth certificates, finger prints and a DNA sample for each of us. If something happens in Colorado, at least we can put our lives back together.

Anyone who thinks insurance companies are out there to protect the consumer are fooling themselves. They have to be watched like two year olds with hot stoves.

[pitohui]

10. but your policy is constantly changed year after year

if you've been in your house a long time the original policy may have been -- and in my case has been -- significantly altered over the years

reading the policy first is fine as well as it goes but times go by and 1) eyes get older, you really can't read tiny print any more, and 2) your original policy is out of date

as an example when i originally bought my policy i had coverage to replace damaged trees and shrubs up to $500 apiece, by the time the first disaster occured, which destroyed many shrubs and trees in my yard, that benefit had been removed and i got nothing to replace my trees/landscaping

[Common Sense Party]

11. Scanning is a great idea. I never thought of that. nt

[EFerrari]

12. So, how much are federal judges going for nowadays?

Don't forget to vote the thread up, folks.

K&R

[Swamp Rat]

13. k&r

I hope the judges and insurers who do this end up just like we did in New Orleans - with destroyed homes and shattered lives. That'll learn 'em! :grr: