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The Real Wind v. Water Debate

Ted has taken a more pessimistic view of the recent Katrina case ruling in Leonard v. NationwideWalter and David Rossmiller both have taken a more optimistic view.  I think there is some room for optimism too.  While the judge threw out the anti-concurrent causation language as being vague, Judge Senter did hold in his rulings of law that ...

Under applicable Mississippi law, in a situation such as this, where the insured property sustains damage from both  wind (a covered loss) and water (an excluded loss), the insured may recover that portion of the loss which he can prove to have been caused by wind. Grace v. Lititz Mutual Insurance Co. 257 So.2d 217 (Miss.1972). Nationwide is not responsible for that portion of the damage it can prove was caused by water. To the extent property is damaged by wind, and is thereafter also damaged by water, the insured can recover that portion of the loss which he can prove to have been caused by wind, but the insurer is not responsible for any additional loss it can prove to have been later caused by water. Lititz Mutual Insurance Co. v. Boatner, 254 So.2d 765 (Miss.1971).

Thus, if the insurer or the insured can make a case for coverage based on evidence of the source of loss, I don’t think one has to worry about the concurrent causation issue as much.  Under Mierzwa (a recent Florida case) which said that if two causes were established (wind and flood) and one was excluded (flood), the insurer was responsible for the policy limits even if flood was the major cause of the homes destruction.  Judge Senter doesn’t come out and reject this, but he does assert that Mississippi law does not require the payment of the value of the policy in a case where there are two causes and the major amount of damage was caused by an excluded loss. 

It doesn’t appear that this valued policy issue was brought before the court. However, it seems like a reasonable conclusion from the opinion the valued policy notion is not as broad as Florida’s as each party must prove its version of the loss based on what caused the damage and whether the cause was covered by the policy.




Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.