Insurance Companies Confess in Court: "We Wouldn't Pay a Dime" . . . unless sued!

In the aftermath of Hurricane Katrina, insurance companies shifted wind damage claims to the National Flood Insurance Program that should have been covered by their own homeowners policies.

On June 9, 2009, the Mississippi Supreme Court heard oral arguments on the interpretation of the industrys anti-concurrent causation (ACC) clauses, which are buried deep inside homeowners insurance policies. The attorney for Nationwide, Christopher Landau, told the Supreme Court that Nationwide applies the ACC clause to exclude coverage of all damage caused by hurricane winds if subsequent flooding was sufficient to have caused the damage anyway.

In response to questioning, Landau answered that even if a house were 95 percent destroyed by winds before any flooding, Nationwide wouldnt pay a dime to the policyholder if the flooding was severe enough to have destroyed the house anyway.

Following this public admission in court, Rep. Gene Taylor (D-MS) explains how his proposed Multiple Peril Insurance Act solves this burdensome homeowner insurance crisis impacting Coastal Americans.

For more information, go to taylor.house.gov/InsuranceReform.

(Video of Mississippi State Supreme Court courtesy of the Court Clerk's Office.)

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