Shaun Marker – May 27, 2013
Those involved with Sandy claims in New York have likely become familiar with anti-concurrent cause provisions in property insurance policies. These provisions are favored by insurance carriers to support denials of coverage for hurricane losses. Assemblyman Phil Goldfeder recently proposed a bill (A07455) which would outlaw anticoncurrent policy provisions that exclude losses from occurrences where both covered and non-covered perils occur at the same time.
The bill’s memo states:
In the aftermath of Superstorm Sandy, many homeowners were surprised when insurance companies denied their claims for perils that should have been covered under the policy (such as windstorm damage) because the perils occurred at the same time as a flood, which is excluded under most homeowners policies. As a result, these homeowners found themselves without adequate insurance coverage at a time when they needed it the most.
This bill would rectify this by prohibiting insurance companies from denying claims under these circumstances.
Assemblyman Goldfeder’s district in Queens, New York City, includes Breezy Point, Rockaway, and other areas that suffered catastrophic losses from Sandy. Several politicians have expressed their concern about the unfairness of anti-concurrent cause provisions.
Politicians have recognized there is something inherently unfair in denying claims under anti-concurrent cause provisions following a tragedy like Hurricane Sandy, and they are rallying on the political front. We will continue to follow this bill and will provide updates on its progress.
Much litigation could ensue over anti-concurrent cause provisions. Insurance carrier representatives disagree and debate with policyholder representatives how these coverage cases will play out in Court. We should all hope insurance carriers follow a golden rule in this area.