Posted on 08/02/2007 11:06:26 AM PDT by SmithL
New Orleans (AP) -- A federal appeals court ruled Thursday against Hurricane Katrina victims who argued their insurance policies should have covered flood damage caused by levee breaches that flooded 80 percent of New Orleans during the 2005 storm.
The case could affect thousands of rebuilding residents and business owners in Louisiana. An insurance expert had said a ruling against the industry could have cost insurers $1 billion.
"This event was excluded from coverage under the plaintiffs' insurance policies, and under Louisiana law, we are bound to enforce the unambiguous terms of their insurance contracts as written,"
(Excerpt) Read more at sfgate.com ...
For insurance cases, the courts rule like this. For cases involving the US Constitution, they like to play a little more fast and loose with the language.
unambiguous terms............No, I can’t believe that! Surely there must be a clause that says I don’t have to buy Flood Insurance to be insured for a flood!.......
Article IV of the Constitution prevents the government from altering a contract. This should be a no-brainer, but you never know these days.
Wow. Federal judges actually getting it right. Well it won't be long until the LA Congressional delegation demands Federal aid for the plaintiffs.
L
Better headline: Court Rules For Plain Reading of Policy Terms; Living Contracts Lose, Original Language Affirmed
SHOULD have covered flood damage? Wow. I am stunned that the court ruled against these folks. :)
No wonder New Orleans is a stinking Hell hole. Good Lord.
Lemme see now. I live in a city that is 10 feet below sea level, yet I don’t buy flood insurance.
Yup, Bush’s fault.
Why would you want to do that. The taxpayers will be happy to give you money. FEMA, SBA, HUD...
That’s stupid.
Although - I have to say I call the bullsh*t alarm on situations where the house was blown away by wind, then the land was flooded, but the insurance company says “sorry - flood damage” and refuses to pay up.
There are situations where that has happened, and often in places not considered a flood zone and therefore not having flood insurance.
This will not likely affect those claims not associated with levee breaches.
As for storm surges caused by wind, I think it helps the insurance companies. The real problem is trying to determine which homes and businesses were destroyed by wind and rains prior to the surge reaching the property.
What is a flood? The dam breaking or the dam overflowing?
Dam breaking is a flaw in the infrastructure, not nature giving more than you can handle.
the Fifth Circuit is very conservative for the most part.
I’m not sure if this is the same case, but I recall at one stage of litigation, an insurer that had gone to a ‘plain language’ policy was getting hosed, but the folks that kept the legalese were winning.
I had heard that we taxpayers have already ponied up some outrageous amount for every man woman and child in New Orleans. And these “plaintifs” wanted a judge to rewrite their insurance contracts?
I believe the simple explanation is 'a great amount of water present in otherwise dry areas'. :-)
Realistically, the cause is irrelevent - flood insurance covers floods, while insurance that specifically states that floods are not covered does not cover floods. It couldn't be any simpler.
The court ruled correctly. The contract means what it says.
A flood is rising water. Or as the law dictionary says: "An inudation of water over land not usually covered by it...Stover v. US, D.C.Cal, 204 F.Supp. 477, 485.
I can show you places in New Orleans where there were two houses next to each other. One is still standing and has No sign of flood damage and the house next door is completely demolished. The insurance adjusters are claiming that the demolished house was destroyed by flood while there is no evidence that that area of town was flooded after the Corps of Engineer’s Levee failed.
There is a difference between wind driven water (tidal surge ahead of a hurricane) which requires a FEMA flood insurance policy, and wind driven rain, which is covered under your normal homeowner’s policy.
Most beefs regarding Katrina was in distinguishing the two in court.
In 2004 being hit with 3 named storms, we had water up to our door steps in Florida. With only less than 1/2 inch to go before the water would have come into our home because of ground saturation (flooding) we were fortunate. If the water had come in and ruined any drywall or wood flooring not to mention solid oak baseboards, without flood insurance, NADA!!!
What part of NO FLOOD INSURANCE COVERAGE don’t they get!?
BTW, it is quite cheap by national standards.
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