Judge: Allstate’s Flood Exclusions “valid and enforceable”

In a move sure to disappoint many policy holders, Allstate will be off the hook for damage done to homes by the flood waters of Hurricane Katrina. Of course flood coverage is available as an additional coverage but many people don’t worry about adding it.

According to Business Week:

APR. 13 6:48 P.M. ET Provisions in Allstate Insurance Co.’s policies that exclude damage from Hurricane Katrina’s flood waters are “valid and enforceable,” a federal judge in Mississippi has ruled — a setback for Gulf Coast policyholders whose claims were denied by the insurer.

A couple whose Gulfport home was damaged by the Aug. 29 storm is suing Allstate for denying their claim, arguing that the wording of their policy’s “flood exclusions” are ambiguous and cannot be enforced.

U.S. District Judge L.T. Senter, Jr., rejected that argument, however. On Tuesday, he ruled that the terms of Allstate’s policies are “clear and unambiguous” in excluding damage from “tidal waters,” which Katrina pushed ashore from the Mississippi Sound and inundated thousands of homes