The battle has begun on whether the Hurricane Ike's damage to the Texas coast was a result of flood or wind. Here is an interesting post from a Texas blogger suggesting that the litigation spawned by Hurricane Katrina may continue in the wake of Hurricane Ike.
Since the storm, Texas legislators have suggested that the Texas Windstorm Insurance Association pay claims for damages resulting from storm surge. This Association has taken on coverage for many coastal homeowners after private insurers withdrew from the market. The Texas post recognizes most homeowners' policies exclude damages caused by flood or storm surge. Further, the post acknowledges the Fifth Circuit's decision in Broussard v. State Farm Fire & Cas. Co., 523 F.3d 618 (5th Cir. 2008) has been there, done that. Although the District Court in Broussard determined that because State Farm could not establish what portion of the loss was attributable to the excluded damage caused by flood, the homeowners were entitled to Judgment as a Matter of Law, and awarded damages. The Fifth Circuit reversed and remanded with instructions on the parties' burden of proof.
The Fifth Circuit, which includes Texas, has developed a body of law on the flood/wind dichotomy in homeowners' policies. Although it would seem many of the issues decided after Hurricane Katrina would apply to coverage issues after Hurricane Ike, it will be interesting to follow how the litigation develops.
