Damage from the 2004 Hurricanes in Florida brought about disputes between homeowners and insurance companies about what caused damage to homes. Conventional insurance companies pay out for wind damage and separate flood insurance policies pay for flood damage. Earlier court rulings said that insurance companies were responsible for flood damage. The Florida Supreme Court has ruled that insurance companies are not responsible for flood damage.
Just prior to the 2004 hurricanes, a South Florida district court had ruled that under Florida’s valued policy law, insurers must pay policy limits when a covered property is destroyed, even if the damage was partly caused by an uncovered peril.
The so-called Mierzwa ruling exposed Florida’s insurance industry to massive losses in the 2004 storms, and prompted the industry to ask the Legislature to rewrite the state’s insurance laws to their favor.
Hundreds of insurance cases will now have to prove what percentage of damage to a home was caused by the wind. That may prove difficult in cases where there is nothing left to the home.