Flood (n) 1. a great flowing or overflowing of water, esp. over land not usually submerged. 2. any great outpouring or stream: a flood of tears. (v) 7. to overflow in or cover with a flood; fill to overflowing: Don’t flood the bathtub.
Give me a break… of course flood isn’t defined where it comes from… the intent isn’t to exclude a type of flood or an event leading to the flood. This is just another frivilous lawsuit from people who didn’t read their policy contracts until it was too late (or who didn’t think an area below sea level that’s prone to hurricane activity would EVER actually flood).
Hi Anon – For a typical HO ins. policy holder, are they protected from hurricaine damage and not flood nor wind? Am I getting that correct? and what these policy holders are saying is that since this particular flood was caused by broken levees, then the insurance company should cover the damages?
Just looking for clarification (and some education on the subject). Thanks for your help!
The HO policies I’ve seen will cover the damage caused by wind of a hurricane. Other water damage (other than wind driven water) is generally considered not covered as part of the flood exclusions.
I understood the original arguments some people were presenting that some of the flooding was caused by the storm surge. Since a solid argument could be made that storm surge could be considered wind driven water and most policies did not exclude storm surge specifically, that there might be valid claims from that argument.
However, a breaking levee / dam would usually be considered a flood (and would probably be called a flood by anyone who looked at it). There’s been prior cases where small dams failed and flooded communities. In cases where those dams were private dams the owner was responsible for the damages. A public works project like the levees would be the responsiblity of the city/state to maintain and ensure no failures.
I admit I generally only handle the auto P&C business that comes through here but still remember the HO information from licensing and CE.
The question is not what the policy means in Nebraska or New England but what it means in the Gulf States. Don’t be surprised if the policyholder wins down in New Orleans.And I don’t want to hear the companies whining if they lose. They know how things work down south… They shouldn’t have taken the premium if they didn’t want to face the music someday.
I can’t tell you how many times my adversaries in Court have used the phrase “reasonable expectations” to form the basis for the Court to find an ambiguity in an insurance policy. It’s the catch-all allegation for people who don’t read their policies, and it allows courts to impose duties and coverages on insurance companies where no such duty or coverage could otherwise “reasonably” be found.
To respond to adjuster in New England, what about the companies’ “reasonable expectations” that these folks, whose premiums are held to competitive rates in the region, would not be able to coerce a Court into granting coverage in situations where the coverage was not bargained for or contemplated by anyone, insurers and consumers alike? An adverse ruling on this issue would actually create coverage where there is no coverage under the policy contract. Once that occurs, watch out for the industry to implode.
Please don’t read my prior comment to mean I think there should be coverage here. However,I do say that any insurance executive who has a reasonable expectation to win on coverage questions in a court anywhere in Louisiana (especially a lower court) is not being very realistic and,if truly surprised, displays a shocking lack of knowledge as to the market they are operating in.
Remember that Louisiana is the state where it was just discovered that the state run property insurance company, Citizen Insurance, has neglected to maintain records as to how much money came in and was paid out for two years so they can’t balance the books for those two years. That is what one can reasonably expect in Louisiana.
What direct knowledge do you posess of the legal system in the state of Louisiana?
The records keeping of Citizen Insurance is in no way relevant to how a U.S. appeals court will rule on the flood exclusion.
Seems to me that New England is where a drunk U.S. senator drove into a lake and a lady was killed. I wonder how that relates to questions of flood coverage in your part of the country.
I think Adjuster in New England makes a good point. After all, Louisiana is one of two direct action states and adheres to Napoleonic Law, not Common Law like most states do. I’d be looking for all that money in someone’s freezer down there.
My knowledge of Louisiana comes from handling claims there and in other parts of the Gulf states over a number of years. Lawyers in New England don’t use the term “home cooking” but I have heard defense counsel in Louisiana use the term many times to explain why you are better off paying much more than a case would be worth in most parts of the country because you will pay even more if you don’t settle before there is a verdict.
The history of Citizens does not directly relate to the Katrina matter but it does speak to how things work in the state. So too does three Insurance Commissioners being convicted by the US Attorney in Louisiana. Insurance executives who think things work the same in Louisiana as in other parts of the country are fooling themselves.
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From dictionary.com:
Flood (n) 1. a great flowing or overflowing of water, esp. over land not usually submerged. 2. any great outpouring or stream: a flood of tears. (v) 7. to overflow in or cover with a flood; fill to overflowing: Don’t flood the bathtub.
Give me a break… of course flood isn’t defined where it comes from… the intent isn’t to exclude a type of flood or an event leading to the flood. This is just another frivilous lawsuit from people who didn’t read their policy contracts until it was too late (or who didn’t think an area below sea level that’s prone to hurricane activity would EVER actually flood).
Hi Anon – For a typical HO ins. policy holder, are they protected from hurricaine damage and not flood nor wind? Am I getting that correct? and what these policy holders are saying is that since this particular flood was caused by broken levees, then the insurance company should cover the damages?
Just looking for clarification (and some education on the subject). Thanks for your help!
The HO policies I’ve seen will cover the damage caused by wind of a hurricane. Other water damage (other than wind driven water) is generally considered not covered as part of the flood exclusions.
I understood the original arguments some people were presenting that some of the flooding was caused by the storm surge. Since a solid argument could be made that storm surge could be considered wind driven water and most policies did not exclude storm surge specifically, that there might be valid claims from that argument.
However, a breaking levee / dam would usually be considered a flood (and would probably be called a flood by anyone who looked at it). There’s been prior cases where small dams failed and flooded communities. In cases where those dams were private dams the owner was responsible for the damages. A public works project like the levees would be the responsiblity of the city/state to maintain and ensure no failures.
I admit I generally only handle the auto P&C business that comes through here but still remember the HO information from licensing and CE.
The question is not what the policy means in Nebraska or New England but what it means in the Gulf States. Don’t be surprised if the policyholder wins down in New Orleans.And I don’t want to hear the companies whining if they lose. They know how things work down south… They shouldn’t have taken the premium if they didn’t want to face the music someday.
I can’t tell you how many times my adversaries in Court have used the phrase “reasonable expectations” to form the basis for the Court to find an ambiguity in an insurance policy. It’s the catch-all allegation for people who don’t read their policies, and it allows courts to impose duties and coverages on insurance companies where no such duty or coverage could otherwise “reasonably” be found.
To respond to adjuster in New England, what about the companies’ “reasonable expectations” that these folks, whose premiums are held to competitive rates in the region, would not be able to coerce a Court into granting coverage in situations where the coverage was not bargained for or contemplated by anyone, insurers and consumers alike? An adverse ruling on this issue would actually create coverage where there is no coverage under the policy contract. Once that occurs, watch out for the industry to implode.
Well put.
Please don’t read my prior comment to mean I think there should be coverage here. However,I do say that any insurance executive who has a reasonable expectation to win on coverage questions in a court anywhere in Louisiana (especially a lower court) is not being very realistic and,if truly surprised, displays a shocking lack of knowledge as to the market they are operating in.
Remember that Louisiana is the state where it was just discovered that the state run property insurance company, Citizen Insurance, has neglected to maintain records as to how much money came in and was paid out for two years so they can’t balance the books for those two years. That is what one can reasonably expect in Louisiana.
Adjuster in New England,
What direct knowledge do you posess of the legal system in the state of Louisiana?
The records keeping of Citizen Insurance is in no way relevant to how a U.S. appeals court will rule on the flood exclusion.
Seems to me that New England is where a drunk U.S. senator drove into a lake and a lady was killed. I wonder how that relates to questions of flood coverage in your part of the country.
I think Adjuster in New England makes a good point. After all, Louisiana is one of two direct action states and adheres to Napoleonic Law, not Common Law like most states do. I’d be looking for all that money in someone’s freezer down there.
My knowledge of Louisiana comes from handling claims there and in other parts of the Gulf states over a number of years. Lawyers in New England don’t use the term “home cooking” but I have heard defense counsel in Louisiana use the term many times to explain why you are better off paying much more than a case would be worth in most parts of the country because you will pay even more if you don’t settle before there is a verdict.
The history of Citizens does not directly relate to the Katrina matter but it does speak to how things work in the state. So too does three Insurance Commissioners being convicted by the US Attorney in Louisiana. Insurance executives who think things work the same in Louisiana as in other parts of the country are fooling themselves.