TALLAHASSEE, Fla. - The Florida Supreme Court recently decided something of a "Wind v. Water" case, rejecting a plaintiff's claim that an insurance company was wholly responsible for damages done by 2004's Hurricane Ivan.
Eugene Cox alleged Florida Farm Bureau Casualty Insurance Co. was obligated to pay him $65,000, the full limit of his homeowners policy. Citing the Valued Policy Law, implemented in 1899, Cox said it did not matter that covered perils did not cause 100 percent of the destruction of his home.
The Court, in a unanimous opinion authored by Justices Charles Wells, disagreed. Wind damage was covered in Cox's policy, but water damage is covered by the National Flood Insurance Program.
"The insured property was damaged by a combination of wind and water in a hurricane," Wells said. "The insurer asserted that it was responsible for the percentage of the total loss attributable to wind.
"The insurer did not contest the total value of the property. We find that the Fourth District misconstrued the VPL in holding that 'if the insurance carrier has any liability at all to the owner for a building damaged by a covered peril and deemed a total loss, that liability is for the face amount of the policy.'"
Though Cox requested $65,000 for his home and an extra $42,000 for personal belongings and other provisions, Florida Farm Bureau provided $11,583.93 for wind damages, $3,227.14 for damage to other structures and $2,000 for living expenses.
The wind damage/water damage debate over thousands of Hurricane Katrina-related claims is at the heart of Mississippi Attorney General Jim Hood's lawsuit against five insurance companies.
Florida's Court decided the VPL will not be a valid enough legal argument for plaintiffs in its state.
"Based upon (the) plain language of the statute, we conclude that the statute intends that an insurer is liable for a loss by a peril covered under the policy for which a premium has been paid," Wells said.