NEW ORLEANS - Hurricane Katrina victims whose homes and businesses were destroyed when floodwaters breached levees in the 2005 storm cannot recover money from their insurance companies for the damages, a federal appeals court ruled Thursday.
The case could affect tens of thousands of rebuilding residents and business owners in Louisiana, Daniel E. Becnel, who represented 21 plaintiffs in the case, said. Insurers could have taken a “multibillion dollar hit” if the ruling had gone against the industry, said David Rossmiller, an insurance attorney and analyst.
“This event was excluded from coverage under the plaintiffs’ insurance policies, and under Louisiana law, we are bound to enforce the unambiguous terms of their insurance contracts as written,” Judge Carolyn King wrote for a three-judge panel of the 5th U.S. Circuit Court of Appeals.
