August 18, 2006
No Flood Compensation for the Leonards
If a hurricane destroys your home, how do you decide the percentage of damage that was caused by wind and the percentage that was caused by flood waters swept in by the hurricane? Do you even stop to think twice if your homeowners’ policy covers both damage due to wind and floods?
This couple is paying the price for not reading the fine print. A U.S. District Court judge ruled that Paul and Julie Leonard were not entitled to any claims on flood damage from Hurricane Katrina. The court offered them a small amount as compensation for wind-induced damage, a ruling that the couple’s attorney called a small victory.
Nationwide Mutual Insurance, the insurance company on the other side of the case is jubilant with the judge’s decision. It should be, considering that the court saved the company from having to shell out $130,000 claimed as flood damage by the couple. The insurer is liable to pay only $1,228 to cover wind damage.
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