Mississippi's attorney general on Thursday sued insurers to force them to pay flood damage from Hurricane Katrina, saying standard insurance polices have led homeowners to believe they are covered for all hurricane damage, whether from wind or flooding.
Attorney General Jim Hood asked the Hines County Chancery Court to void provisions in the policies that attempt to exclude from coverage losses or damages directly or indirectly caused by water, whether wind-driven or not. Those losses could reach into the billions of dollars.
Only about 3 in 10 houses in disaster-struck portions of Mississippi and Alabama had flood insurance, according to Federal Emergency Management Agency estimates.
Katrina destroyed more than 68,000 homes, apartments and condos in the state's six southernmost counties, and caused major damage to about 65,000, according to a preliminary survey by the American Red Cross. Many homes were destroyed by up-to-30-foot (9 meter) wall of water driven ashore by the hurricane's Category 4 winds.
"The residents and/or property owners of Mississippi Gulf Coast purchased these policies from defendants for the primary purpose of insuring against any damage that could possibly result from hurricanes originating from the Gulf of Mexico," Hood said in the complaint.
He said homeowners purchased the policies with the "reasonable expectation that these policies would provide such coverage."
The exclusions contained in the policies violate the public policies of the state, he said.
Hood is also seeking to block the use of a claims adjustment form that requires homeowners to acknowledge their damage was caused by flooding.
The form includes the sentence: "This agreement acknowledges you have sustained a flood loss on the above date at the above address.", AP reported.
The strike was defensive in nature and came in response to three attacks on the US military in February