Katrina: Legal Fallout in Mississippi - 09/19/05 11:28 PM
(Mississippi) Attorney General Jim Hood today(9/16) announced that his office has filed a civil action against the insurance industry seeking to declare void and unenforceable certain rovisions contained in property casualty insurance policies issued to Mississippi Gulf Coast residents excluding coverage from damage caused by Hurricane Katrina.
The Complaint asks the Court to declare that certain insurance contract provisions are
void and unenforceable as the same are contrary to public policy, are unconscionable, and
are ambiguous. The provisions at issue attempt to exclude from coverage loss or damage
caused directly or indirectly by water, whether or not driven by wind. The Complaint
states that these provisions should be strictly construed against the insurance companies
who drafted the insurance policies and their exclusions. The Complaint also states that
the issuance of such insurance policies violates the Mississippi Consumer Protection Act.
The Complaint also asks the Court, among other things, to enter a Temporary Restraining Order to immediately stop insurance companies from asking property owners to sign documents stating that their loss was caused by flood or water as opposed to wind, and to stop using water exclusions to deny or reduce coverage for hurricane damage or loss. The Court is also being asked to enter a preliminary and permanent injunction with regard to
these same matters.
The above was copy and pasted from an offical statement, released last Friday and can be referenced here.
To sum things up though, here's what going on that is causing all this...
1) Insurance companys are stating that they are not paying any flood claims for the homes destroyed during Katrina, because of the wording within the flood insurance policies. Reason? Well, within these policies the definition of a flood does not cover any damage caused by a storm surge or "wind driven water". The MS AG is asking the insurance companys to dismiss this "fine print" within their policies.
2) Insurance company adjusters are asking some customers to sign a wavier, without fulling explaining what they are signing, in exchange of the adjuster writing the customer a check, on the spot, for a few thousand dollars. After the customer signs this wavier, of course, they have no benifits what so ever and left with a $200,000 pile of sticks and a $3000 check in their hand.
The actual lawsuit can be veiwed here.
So... What does everyone think??
The Complaint asks the Court to declare that certain insurance contract provisions are
void and unenforceable as the same are contrary to public policy, are unconscionable, and
are ambiguous. The provisions at issue attempt to exclude from coverage loss or damage
caused directly or indirectly by water, whether or not driven by wind. The Complaint
states that these provisions should be strictly construed against the insurance companies
who drafted the insurance policies and their exclusions. The Complaint also states that
the issuance of such insurance policies violates the Mississippi Consumer Protection Act.
The Complaint also asks the Court, among other things, to enter a Temporary Restraining Order to immediately stop insurance companies from asking property owners to sign documents stating that their loss was caused by flood or water as opposed to wind, and to stop using water exclusions to deny or reduce coverage for hurricane damage or loss. The Court is also being asked to enter a preliminary and permanent injunction with regard to
these same matters.
The above was copy and pasted from an offical statement, released last Friday and can be referenced here.
To sum things up though, here's what going on that is causing all this...
1) Insurance companys are stating that they are not paying any flood claims for the homes destroyed during Katrina, because of the wording within the flood insurance policies. Reason? Well, within these policies the definition of a flood does not cover any damage caused by a storm surge or "wind driven water". The MS AG is asking the insurance companys to dismiss this "fine print" within their policies.
2) Insurance company adjusters are asking some customers to sign a wavier, without fulling explaining what they are signing, in exchange of the adjuster writing the customer a check, on the spot, for a few thousand dollars. After the customer signs this wavier, of course, they have no benifits what so ever and left with a $200,000 pile of sticks and a $3000 check in their hand.
The actual lawsuit can be veiwed here.
So... What does everyone think??