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What's Going On: E&O issues in last month's Hurricane Katrina decision

IN INSURANCE company offices last month, you could hear a collective sigh of relief as an important decision in a Hurricane Katrina-related case came down in favor of the carriers. In Paul Leonard and Julie Leonard v. Nationwide Mutual Insurance Co.,

By Harmony Nicole Fortenberry | Updated on August 31, 2006

IN INSURANCE company offices last month, you could hear a collective sigh of relief as an important decision in a Hurricane Katrina-related case came down in favor of the carriers. In Paul Leonard and Julie Leonard v. Nationwide Mutual Insurance Co., the U.S. District Court for the Southern District of Mississippi honored the standard flood-damage exclusion in homeowners policies.

“The provisions of the Nationwide policy that exclude coverage for damages caused by water are valid and enforceable terms of the insurance contract,” Judge L.T. Senter Jr. wrote. As a result, he threw out all but a small part of the Leonards’ claim for $158,000. “Almost all of the damage to the Leonard residence is attributable to water,” he wrote.

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