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Windstorm Damage, "Concurrent" Causes, and Property Insurance in Florida

If you sustain property damage in West Central Florida as a result of windstorm damage along with other causes (such as flooding and fire), and your insurance policy does not cover damage related to all of those causes, will your insurance policy have to provide coverage to repair your home? For instance, let us imagine that a strong thunderstorm strikes in West Central Florida. The storm has very strong winds, but it also produces heavy rains and lightning. A bolt of lightning strikes near your home, and during the storm, your house sustains serious damage as a result of fire from the lightning, flooding from the heavy rains, and wind damage from the strong winds. It is difficult (if not all but impossible) to determine which of these elements caused which particular damage to the structure.

If you have a homeowners' insurance policy that covers windstorm damage, but it does not cover flood damage or fire damage, how will the insurance company handle your claim in which you cite "concurrent" causes for the damage to your property? Under a recent Florida Supreme Court decision in Sebo v. American Home Assurance Co., when a residential property sustains damage as a result of "concurrent" causes and the homeowners' insurance policy covers at least one of those causes, then the insurer will have to pay for the entire amount of damage even if one or more of the other "concurrent" causes is excluded from the homeowners' insurance policy.

Facts and History of the Sebo Case

As the Florida Supreme Court decision explained, the plaintiff purchased a home in Florida and an "all-risk" homeowners' insurance policy from American Home Assurance Company (AHAC). During the course of ownership, the residential property sustained various forms of damage connected to water leaks, design defects, and construction defects. After months of water-related damage that often was worsened because of design and construction defects, a particularly heavy rain caused paint to peel around the windows. Later on, the property sustained additional hurricane damage. In sum, the plaintiff sustained losses to the property caused by defective construction, water damage, and windstorm damage.

The property owner filed a claim with AHAC, but the insurer refused to pay for the majority of the damages because it contended that, under the homeowners' insurance policy, defective construction and design were not covered. It stated specifically that "window, door, and other repairs . . . is not covered." The property ultimately could not be repaired and ended up being demolished.

At the trial level, the plaintiff argued that the "concurrent causation doctrine" should apply, meaning that a plaintiff should be covered for all damages as long as the damage resulted from combined, or concurrent, causes that worked together to cause the property damage. The jury found in favor of the plaintiff, and AHAC appealed. The appeals court found in favor of the defendant and its "Efficient Proximate Cause" argument. The plaintiff subsequently appealed to the Florida Supreme Court, which had to decide which theory or recovery to apply.

Concurrent Cause Doctrine in Property Damage Cases

The Florida Supreme Court ultimately determined that the "Concurrent Cause Doctrine," or CCD, "provides that coverage may exist where an insured risk constitutes a concurrent cause of the loss even when it is not the prime or efficient cause." The Court reasoned that, because there was "no reasonable way to distinguish the proximate cause of . . . property loss-the rain and construction defects acted in concert to create the destruction of [plaintiff's] home," the CCD should apply.

What kind of impact will the Florida Supreme Court's decision have on future cases? It is likely that new cases arising in West Central Florida in which a property owner sustains damage from multiple causes, at least one of which is excluded from coverage in the homeowners' insurance policy, that property owner still may be covered for all of the losses as long as the insurance policy covers one of the causes of damage.

If you sustained windstorm damage to your home and have questions about filing a claim for compensation, a windstorm damage attorney in West Central Florida can assist you. Contact the Wells Law Group, P.A. today for more information.

http://www.floridasupremecourt.org/decisions/2016/sc14-897.pdf

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