WLBT 3 - Jackson, MS: Katrina Insurance Ruling Sends Case to Trial

Katrina Insurance Ruling Sends Case to Trial

by Gene Adams
gene@wlbt.net

The first Katrina insurance judgement has come down in federal court, allowing the case to go forward against Allstate insurance company. Friday a federal court judge denied the company's request that the case not be sent to trial.

Wind, rain, and storm surge pounded the gulf coast for hours during Hurricane Katrina, leaving billions in damages in its wake. But when the rebuilding began, many families did not get what they expected from their insurance company.

Friday afternoon, a federal court ruling is moving one couple who says they have been shortchanged one step closer to trial.

In a case pending against Allstate insurance, Judge L.T. Senter denied a request from Allstate to throw out the case, ruling that it must be brought to trial.

Senter's order also determined that damages caused first by wind and rain must be covered by hurricane insurance, even if flooding not covered in the policy added to the damage.

Senter's ruling declared that a trial was necessary to determine the facts of this particular case. Homeowners say Allstate representatives led them to believe that flood damage would be covered by hurricane insurance, and that a separate flood policy was not needed.

Under Mississippi law, the insurance company would be held liable to cover damages if the homeowners were told that all hurricane-related damages were covered by their policy.

"It does give us comfort," said Attorney General Jim Hood, who is representing a similar class-action suit in state court. Hood says the ruling makes him cautiously optimistic for coastal residents involved in the state suit.

"I don't want to get their hopes up until we get a ruling in state court because that's where it really matters," said Hood. While Friday's ruling in federal court does not set precedence for state court decisions, Hood says the ruling is a positive step for Mississippi plaintiffs.