A Texas resident lost the right to insurance coverage after evidence suggested that flooding damage pursuant to a hurricane was not within the ambit of the resident's policy.
September 04, 2013 /24-7PressRelease/ -- Heated insurance dispute after Hurricane Ike
Article provided by Pennebaker Law Firm
Visit us at http://www.texasbadfaithinsurancelawyer.com
A Texas appeals court recently reversed a $3.9 million verdict award for an owner of an apartment building who claimed that the owner's insurance company did not provide adequate coverage after damage from Hurricane Ike. In its reversal, the appellate court ruled that the insurer did not owe the coverage for the damage that was the subject of the dispute.
Facts and procedure
Hurricane Ike severely damaged the plaintiff's apartment building, and construction experts and building inspectors determined that the structure had to be demolished before it could be restored. This would bring the building up to compliance with local building codes.
The policy provided by the insurance company had two conditions under which the insured could recover for demolition and rebuilding expenses, depending on the circumstances. The first was "ordinance or law coverage," and the second endorsement was named the "demolition and increased cost of construction."
The insurance company argued that the policy provided would not cover the loss caused by flooding. It only paid the insured for the portion of damage related to wind damage, which amounted to approximately $1.3 million.
The property owner claimed it had not received documented notice from the insurance company regarding the remainder of its insurance claim. Furthermore, the plaintiff did not receive an explanation of the overall insurance decision. In fact, the building owner found out from a local adjuster that the company had determined that part of the claim was not within the ambit of the insurance policy. The insurance company felt that the remaining damage was caused by flooding.
In a complaint, the plaintiff sued the insurer for breach of contract, violations of Texas codes and relevant laws. The plaintiff also sued on the basis of bad faith. The jury of the lower court ultimately decided in favor of the plaintiff.
Next, the insurer asked for a new trial, but the motion was denied. However, the appeals court reversed the lower court's rejection of the insurance company's appeal. The insurance company argued upon appeal that the insured was not fully covered by the wind-based policies because a portion of the damage was caused by flooding, which was not within the policy's parameters.
Ultimately, the appellate court found that demolition and rebuilding costs are covered only if the damage results from covered losses that are a part of the policies. In this case, much of the damage was due to flooding.
This case is a prime example of a dispute involving homeowners' insurance. In the aforementioned matter, the court noted that the plaintiff did not submit enough evidence of "additional loss sustained in demolishing and cost incurred in rebuilding as a result of enforcement of a law or ordinance based on damage caused by wind." In a case like this one, the presentation of evidence and damages is imperative to the result.
If you are struggling with your insurance company, you may be successful in your fight for deserved coverage. To learn more about your dispute, take the time to meet with an experienced insurance attorney. A lawyer can explore the intricacies of your case.
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