Now that Hurricane Irene has passed by, people will be able to assess damage, and file insurance claims. It is expected that many of these claims will be disputed by insurance companies, and that will very likely lead to lawsuits. One of the biggest questions has to do with whether damages were caused by wind or by water.
Surviving a hurricane, like Hurricane Irene, is stressful. Soon after the hurricane passes, people become able to go out and see exactly what damages the hurricane inflicted upon their homes, their vehicles, and their personal property that was inside them. If the people had insurance, then they are probably expecting that at least some of the damages will be covered by the insurer. Sadly, this isn’t always a reality.
After a hurricane, or other natural disaster, a wave of court battles will take place. These legal battles will be between insurance companies who denied someone’s claim for damages, and the person who didn’t get the financial help he or she believed the insurer should have provided. Often, the fights are caused when there is a difference of opinion over whether damages were caused by water or wind.
Homeowners insurance will cover damages that happen due to wind. If a homeowner files a claim because of damage that was clearly and obviously caused by wind, then the insurer should be covering it. However, if there is the slightest hint that the damages were actually caused by water, or flooding, then the insurer might feel that there is enough reason to deny the claim.
Homeowners insurance does not cover damages that are caused by flooding. For that, you need a specific, extra, flood insurance policy. If you didn’t purchase a flood insurance policy long before the hurricane hit, then you are basically out of luck. The insurance company you got your homeowners insurance through is going to keep denying your claims that relate to damages caused by water, or by flood.
Unfortunately, people who do have flood insurance might be facing problems as well. Historically, the damages from flooding can be widespread and costly. This means that the insurance company that sold you the flood insurance is probably going to attempt to deny your claim, instead of paying it out. This, too, can lead to a lawsuit.
People that bought flood insurance from the National Flood Insurance Program, and homeowners insurance from a private insurance company, could find themselves waging a legal battle in two different courts. The flood insurance case would be heard in a federal court, and the homeowners insurance case would likely be heard in a state court.
The worst thing about this is that lawsuits can, potentially, take years to resolve. This means that homeowners whose insurers refuse to pay up are going to have to pay out of pocket for the repairs that Hurricane Irene caused them. Then, they will have to wait and see if a court decides to reimburse them for their expenses. To me, this seems like an incredibly unfair situation.
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