FEDERAL DISTRICT COURT GRANTS INSURER’S MOTION FOR SUMMARY JUDGMENT - “HOPES” IT IS ONE OF THE LAST FIRST-PARTY INSURANCE DISPUTES ARISING FROM HURRICANE HARVEY
Recently, a federal district court in Houston began its opinion by stating, “[t]his may be among the last of the many first-party property insurance disputes from Hurricane Harvey. The court hopes so[,]” and then agreed with an insurer who argued that it was entitled to judgment as a matter of law. Laurence v. State Farm Lloyds, et al., Civil Action No. H-19-4314, 2021 WL 5587815 (S.D. Tex. Nov. 29, 2021) involved a dispute between State Farm Lloyds (“State Farm”) and its insured (“Laurence”) over whether the damages suffered by Laurence’s property were from flooding, and therefore excluded, or from water intrusion coming from wind or hail damage to the buildings, and therefore covered.
Laurence held a homeowner’s insurance policy issued by Liberty Insurance Corporation and a contractor insurance policy for his plumbing business issued by State Farm. After Hurricane Harvey hit, Laurence made a claim for damage to his property. State Farm investigated and concluded that all but a small amount of damage was from flooding, and the damage was below Laurence’s deductible, so it did not pay his claim. Laurence followed with a suit alleging breach of contract, breach of the duty of good faith and fair dealing, and violations of the Texas Insurance Code.
State Farm responded by filing a motion for summary judgment, arguing that Laurence cannot show he was covered by the policy because the policy did not cover damage to buildings, only to business personal property, and the evidence showed no damage over the $1,000 deductible from wind-or hail-driven water (as opposed to flood water). Such evidence included the declaration of State Farm’s retained engineer, who stated that his inspection showed no conditions consistent with the effects of wind and revealed flood debris lines that were about 7 feet above the finished floor. State Farm also provided photographs showing the height of floodwater outside the property. Laurence, on the other hand, could not point to any evidence in the record showing that his business personal property was not damaged by flood water that exceeded his deductible. Once the Court concluded no coverage existed, it summarily dismissed Laurence’s extra-contractual claims and granted State Farm’s motion for summary judgment.