09/07/2005: You've gotta love lawyers....
for being able to find such meaningful distinctions:
And in cases where they are explicitly on the hook, insurance companies can be counted on to resist—even in the most emotion-laden cases. After 9/11, when Larry Silverstein, who owned the lease on the Twin Towers, tried to collect on his insurance policy, insurers argued that the two attacks were a single event, thus capping the amount Silverstein could receive. Silverstein took them to court, and last December convinced a jury that the two plane crashes were two distinct events.
Something similar may be shaping up here. In its report, RMS noted that the destruction is tied to two distinct events: 1) Hurricane Katrina; and 2) "the Great New Orleans Flood which has resulted from failure of the levee systems that protect New Orleans." Expect plenty of insurers to argue that they'll be happy to pay for property damaged by the hurricane, but not for both the hurricane and the flooding, if individuals or businesses lacked flood insurance. According to RMS, "at least 50% of total economic loss is expected to come from flooding in New Orleans." Needless to say, the vast majority of those who have lost businesses and residences in the past week don't have Larry Silverstein's ability to litigate.
--Daniel Gross, on insurance company reactions to Hurricane Katrina
Len on 09.07.05 @ 05:44 AM CST