Congressman, attorney: Ruling a huge win for policyholders

By Rebecca Powers - bio | email

LONG BEACH, MS (WLOX) - A Mississippi Supreme Court decision this week means a Long Beach couple will have their day in court after all.

After Hurricane Katrina destroyed their home, Dr. and Mrs. Magruder Corban sued their insurance company. The Corbans had more than a million dollars in coverage with USAA Insurance, but were paid just a small amount for roof damage and $250,000 for their flood policy.

A circuit court judge originally ruled against the Corbans, but on Thursday the state Supreme Court overturned that decision.

The court said that storm damage can be excluded from coverage by language in the policy when it's caused by a combination of wind and water acting together. But that that exclusion shouldn't apply in the Corban case if the wind and water damage could be distinguished.

The high court's decision means the Corbans' case will be heard by a jury. But the couple's attorney said it could have an even wider impact on other homeowners who suffered storm damage from Katrina.

Biloxi attorney Judy Guice said the president before was flawed.

"It basically held that if your property sustained any flood damage, you are not entitled to get paid, even for wind damage," Guice said. "This decision by the Mississippi Supreme Court says,  No, that is not Mississippi law. You will be paid for wind damage, even if the water later impacts your property."

The decision shifts the burden of proof to the insurance companies, instead of the policy holder. Congressman Gene Taylor, who lost his home to Hurricane Katrina, called it a victory for all South Mississippians.

"We know, for a fact now, that in almost every instance, they shifted all that burden, said the water did it and made the national insurance policy pay. And if you notice, the national flood insurance plan lost billions of dollars that year. The insurance industry made $44 billion that year," Representative Taylor said.

The fourth district congressman has been fighting for a multi-peril insurance bill and said he can't wait to take this court ruling back to Washington.

Even though Guice and Congressman Taylor are calling this a "huge" win for policy holders, USAA gave this statement: "We are very pleased with this ruling, the court confirmed USAA's approach to handling Katrina claims in Mississippi is correct."

Of that statement, Guice said, "I guess it's spin, you know. I'm glad they're pleased. I guess then they can't use that as an excuse to raise rates, so everybody's happy. We sure are."

If you still have an unsettled claim against your insurance company, Ms. Guice suggests you contact an attorney to see how this might affect what you could be paid.

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