Generally one assumes a flood is caused by an over-accumulation of rain mixed with gravity. In this case the damage was caused by an over-accumulation of wind which overcame the forces of gravity and as such it is not technically "flood" damage, but is wind damage.
It's kinda like taking out a tornado policy and then a tornado comes to your town and picks up a neighbor's car and deposits it on top of your otherwise un-damaged-by-the-wind home and then the insurance company refuses to pay for the damage caused to your home because the policy did not cover damage caused by automobiles.
Additionally, course of dealing is not in the company's favor - that is, the way they acted (and spoke) after Katrina.
I worked in a Personal Injury firm one summer in law school. From that, I learned that some PI lawyers are as sleazy as their reputation, but most are not. The true evil sleazebags are in the insurance companies.
Yes, I agree. Unless they specifically mentioned and exempted storm surge, then it has to have been covered either under hurricane coverage or under flood coverage.
They cannot have it both ways. You can't say it's "wind" when dealing with the flood policy, and then turn around and say it's "flood" when discussing the hurricane policy.
And if they don't specifically sell something called "storm surge" coverage, then they would have a hard time claiming they had "meant" to exempt it.
In my understanding, there is a demarkation between wind and flood damage. Flood damage is covered under the subsidized National Flood Insurance Program and other storm damage is covered by the storm insurance one buys privately, such as that offered by State Farm.
The NFIP payed Mr. Lott. It would seem to me that this means the damage he sustained is from a flood. Now he wants State Farm to pay him again for the same damage. These policies are specifically designed so that the damage is one or the other. So you have flood insurance and storm insurance, you are fully covered by one or the other.
The problem here is that Mr. Lott chose to build a house on the waterfront that was too expensive to be fully covered by the NFIP. Like so many government programs (many of which he supports), it denies benefits to the wealthy. Although limitations on coverage are perfectly clear, Lott decided to build his mansion on the beach anyway, and now wants to be compensated for his poor decision.
If Mr. Lott's losses were below the limitations of the NFIP, he would not be bothering State Farm at all. He would have taken his money from the Feds and been a happy camper. But, since his house was worth more than it was insured for, he has a loss, and is looking to have somebody else pay for that loss. What he really needed was gap insurance, in order to pay the flood losses in excess of what the NFIP would cover. This is not what he had from State Farm.
The question is, do we want to structure the National Flood Insurance Program to basically tax anybody unfortunate enough to live near a body of water in order to subsidize the beachfront mansions of the filthy rich? I say this not to engage in class warfare, but as a legitimate question of public policy. From an overall point of view, building mansions under water is costly and wasteful. If we subsidize that activity, we will get a lot more costly and wasteful behaviour.
"In this case the damage was caused by an over-accumulation of wind"
I take it that's a reference to Congress being in session!!!