RumbergerKirk Wins Another Summary Judgment for Carrier in Limited Water Damage Endorsement Case – JD Supra

Given the rise of Forged iron pipe regulationgo well withs Inside the state of Florida, RumbergerKir…….

Given the rise of Forged iron pipe regulationgo well withs Inside the state of Florida, RumbergerKirk’s current abstract judgment victory upholding a service’s restricted water damage endorsement is a welcomed change for insurance coverage services. It is the agency’s second abstract judgment victory this yr, implementing restricted water damage endorsements for services.  These endorsements have Discover your self to be considerably mainstream in Florida householders insurance coverage policies.  The intent is To Scale again premium prices for insureds, decrease the submitting of extreme water damage claims, and to presumably reduce pointless litigation prices.  A lot of the endorsements restrict safety to $10,000 for damage Launched on by water from a plumbing system, collectively with The worth of tear out. 

The drawback, however, is that trial courtrooms Throughout the state of Florida have been invalidating and/or narrowing the scope Of these endorsements, Counting on arguments common by Plaintiff’s bar thOn the endorsements are both obscure, ambiguous, or expressly Do not embrace The worth of tear out and/or completely different fringe coverage advantages.  So as to add insult to damage, as a Outcome of There’s typically no final order entered, services Do not have quick recourse to attraction the courtroom’s ruling.  Instead, even in circumstances the place services have paid the $10,000 restrict pre-go well with, They’re pressured to litigate the case by way of to trial.  In consequence, given the risks Associated to trial, a judgment invalidating the endorsement(s) typically Leads to elevated litigation prices and/or settlement of the case on unfavorable phrases to the service.  However, given RumbergerKirk’s current victories, there seems to be a enchancment On the trial courtroom diploma in the direction of implementing these endorsements.

On this case, the service had a single water damage safety endorsement.[1]  The endorsement restricted safety to $10,000, for direct bodily damage Launched on by sudden and unintentional discharge or overflow of water from within a plumbing system.  It embraced The worth of tearing out and changing any An factor of the constructing Important to restore the system from which the discharge occurred.  Plaintiff additionally acquired a $153.00 premium credit rating in commerce for the endorsement.  Plaintiff expert a water loss, and the service issued safety For about $1,200.  Because of water loss, the service moved for partial abstract to restrict damages in this case to $10,000, pursuant to the coverage’s restricted water damage endorsement.  Plaintiff filed a cross-movement for abstract judgment, looking for to invalidate the endorsement.

At the listening to, the service argued the endorsement was clear and unambiguous, outlining pretty A pair of current appellate circumstances validating comparable water damage endorsements on attraction. See Sure Underwriters at Lloyd’s London vs. Pitu, Inc., 95 So. 3d 290 (Fla. 3d DCA 2012) (reversing a $1.2 million verdict, discovering the coverage expressly restricted restoration for water damage to $25,000); Archer v. Tower Hill, 313 So. 3d 645 (Fla. 4th DCA 2021) (afagencying trial courtroom’s grant of abstract judgment, Partially, as a Outcome of the water damage exclusion endorsement was clear and unambiguous and, thus, barred safety for the claimed plumbing leak); and Dodge v. Peoples Notion, 321 So. 3d 831 (Fla. 4th DCA 2021) (holding rust and corrosion to pipes was act of nature that triggered $10,000 restrict on insurer’s authorized obligation beneath water damage exclusion in house-proprietor’s insurance coverage coverage). Whereas pretty A pair of trial courtroom’s have invalidated and/or restricted these endorsements, It is rather essential notice That there is not a appellate case regulation invalidating water damage endorsements. 

Nevertheless, in response, Plaintiff argued the endorsement was ambiguous, claiming the coverage distinguishes between two A quantity of Kinds of water losses—a 2.c.(5) “unintentional discharge” loss And a couple of.c.(6) “put on and tear” loss.  Plaintiff argued that as a Outcome of the endorsement had comparable lead-in language to The two.c.(5) “unintentional discharge” provision, it solely restricted 2.c.(5) losses, and Does not restrict 2.c.(6) “put on and tear” losses.  Plaintiff claimed the loss was triggered be put on and tear, not unintentional discharge.  Because of purported ambiguity, Plaintiff sought damages in extra of $10,000.  In An in depth order, the courtroom dominated the service’s endorsement was clear and unambiguous, restricting damages to $10,000.  In consequence, the courtroom denied Plaintiff’s cross-movement. 

The courtroom’s ruling follows the appellate enchancment of validating these restricted water damage endorsements.  Shifting forward, the place relevant, services might use the steps outlined above when looking for abstract judgment in comparable circumstances.  


[1] Some services have two water damage endorsements—one endorsement that excludes all water damage ensuing from a plumbing system, and ancompletely different endorsement that rolls safety again on, however restricts authorized obligation to $10,000.