The Florida Supreme Court has ruled that policyholders can get coverage for an entire property insurance claim when there are multiple concurrent losses, at least one of which is covered under a policy.
The decision stems from a dispute between homeowner John Sego and American Home Assurance Company. Sego sued AHA when the company refused to cover damage to his home caused by Hurricane Wilma. AHA cited an exclusion for faulty, inadequate or defective planning and claimed that construction defects were the primary cause of damage to Sego’s home, according to court documents.
The original trial jury found for Sebo, and the judge awarded him damages equal to the full $8 million-dollar homeowner’s policy. That was in line with a 1988 appellate court decision — the so-called Concurrent Cause Doctrine — that has long been used to evaluate insurance claims. But in 2014 an appeals court reversed the decision.
The Florida Supreme Court, however, agreed 6-1 with the original jury’s finding.
“We conclude that when independent perils converge and no single cause can be considered the sole or proximate cause, it is appropriate to apply the concurring cause doctrine,” Justice James E.C. Perry wrote in the majority decision.
The supreme court did find that the trial court should have considered previous settlements Sego received from his home’s architect and builder, and remanded the case to the lower court to consider whether AHA’s penalty should be reduced in light of those two settlements.
