Policy Language at the Core of Katrina Appeals Case
State Farm's policy language denying Gulf Coast homeowners’ claims after Hurricane Katrina is at the center of a case scheduled to be heard today by a federal appeals court.
According to the insurer, its policies cover damage from hurricane-force winds, but not from rising water, and it has refused to pay for any damage from Katrina’s monster storm surge.
In addition, State Farm stated that damage from a combination of wind and rising water is excluded from coverage. However, in 2006, a federal judge in Gulfport, Miss., ruled that this “anti-concurrent cause” policy language is ambiguous and therefore can’t be enforced.
In the same ruling, Judge L.T. Senter Jr. refused to throw out a lawsuit filed by John and Claire Tuepker, State Farm policyholders whose home in Long Beach, Miss., was reduced to a concrete slab by the Aug. 29, 2005, storm.
State Farm appealed Senter’s ruling to the 5th U.S. Circuit Court of Appeals in New Orleans. A three-judge panel is scheduled to hear arguments today from attorneys on both sides of the case.
In court papers, the Tuepkers’ attorneys suggest that State Farm’s policies are “craftily ambiguous” and are “woven so as to not give away their true intent.”
“Indeed, since Katrina, it has become painfully obvious that, in anticipating the risk posed by a powerful hurricane, State Farm intended all along to exclude damage ostensibly caused by a combination of water and water, the one-two punch without which a meteorological event is something other than a ’hurricane,”’ the couple’s attorneys wrote.
In a different case, however, the Mississippi Court of Appeals found that State Farm’s anti-concurrent cause language is “clear” and unambiguous, the company’s attorneys say.
“Courts in many other jurisdictions have likewise upheld the validity of this same language,” State Farm attorneys wrote in court papers.
The Tuepkers are among thousands of homeowners in Mississippi and Louisiana who have sued their insurers after the Aug. 29, 2005, storm.
Published on September 6, 2007
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