When is a tornado not a tornado? When it's part of a hurricane.
A Florida insurer won a legal battle against homeowners recently when it was permitted by courts to define a tornado as a hurricane under a homeowner's insurance policy.
The plaintiffs in the case filed a property insurance claim after their house was damaged by tornadoes that followed Hurricane Jeanne. Their insurer, State Farm Florida, paid the insureds the amount it owed under the policy for building property and personal property damage and for additional living expenses for "loss of use" of the property. But it limited these additional living expenses to 10 percent of the personal property coverage, in accordance with the policy's language on hurricane damage.
The policy's hurricane coverage endorsement defined a hurricane as "a storm system that has been declared a hurricane by the National Hurricane Center."
The Insureds Hoped the Tornado Would Not Be Considered Part of the Hurricane
The homeowners sued for breach of contract, saying the insurer should have provided additional living expenses coverage under the general policy provisions, not the hurricane coverage endorsement, because their loss of use was caused by tornadoes, not a hurricane. Had the general policy provisions applied, the reimbursement would not have been limited to 10% of the personal property coverage.
Initially, a trial court granted a summary judgment for the homeowners, ruling that the insurance company should have been less vague about the types of storm damage covered. But an appeals court disagreed. It ruled that if the National Hurricane Center names a storm system a hurricane, the elements of the storm, including subsequent tornadoes, together constitute the hurricane. That decision has now been allowed to stand by Florida's highest court.
When Will a Windstorm Be Considered Separate From a Hurricane
While State Farm and the appellate courts may have viewed the case a narrow one, it raises important questions for homeowners about the scope of their coverage. How far removed from a hurricane must a storm be before an insurer will treat it is a separate weather event?
If you involved in a dispute over wind and hurricane insurance coverage, expert legal counsel can help advise of you of your rights. While insurers will do their best to interpret policy provisions in their favor, an energetic and experienced insurance lawyer can help to level the playing field.