Concurrent Causation: What It Means For Property Insurance Disputes

Some insurance policies have an anti-concurrent clause, meaning damages will not be covered if property damage occurs for various reasons. In Florida, the courts tend to enforce anti-concurrent clauses. However, it is essential to note that if your policy does have such a clause, you can still oppose its application based on ambiguous grounds. Many anti-concurrent provisions are written in a way that is so vague that they are unenforceable or have room to be interpreted in a manner that is favorable to you.

What is Concurrent Causation?

Concurrent causation is a clause in insurance policies for dealing with damages or losses that are caused by more than one event. In terms of insurance, concurrent causation happens when a property experiences damage or loss from two separate causes, but only one has insurance coverage, and the other does not. Depending on the situation, the policy, and the state court where the case will be heard, the damages from both causes can be covered. This also tends to be a factor in liability insurance policies.

The legal precedence of concurrent causation dates back to the 1980s when lower courts ruled that claims for losses from concurrent causation were valid. It was ruled that if a covered cause added to the loss that resulted from an excluded cause, the entire damage can be claimed by the policyholder. If an earthquake damages the foundation of a home and a fire starts from a candle that fell due to the disturbance, then both claims are valid according to the courts.

Here is another example: When a storm causes damage to a commercial warehouse and heavy rains flood the area, the main doors are blown open by strong winds, and flood water enters and causes excessive damage. It is nearly impossible to quantify whether the damage was caused by the wind or water. Therefore, under concurrent causation, coverage will be provided to the policyholder, regardless of whether flood or storm damage was covered or not.

The Effect of Concurrent Causation On Insurance Policies

Insurance policy providers disagreed with concurrent causation, claiming that it increased their costs and liability. Commercial insurers and the Insurance Services Office (ISO) changed the wording in commercial and residential property policies to add anti-concurrent causation to deal with the change.

The new clause stated that the claim amount would exclude damage from listed perils, even after a second covered cause contributed to the loss. The exclusion is applicable even after two causes happen one after the other or at the same time. Many commercial policies have anti-concurrent causation worded to exclude damage from earth movement, nuclear hazard, government action, water, mold, fungus, and flood. These are some common anti-concurrent causation clauses.

Suppose you live in a jurisdiction that allows concurrent causation, such as Florida. In that case, it is always beneficial to read the fine print of the insurance policy before signing.

However, not all state courts choose to adhere to concurrent causation. Instead, based on the arguments and situation, they determine which cause was predominant for the loss.

The doctrine of concurrent causation is applicable mainly in an all-risk policy, which has a broader scope of perils when compared to a named perils policy. The named perils policy only covers damage caused by perils listed in the policy. However, it is not uncommon to see it still contain an anti-causation clause.

Contact An Experienced Lawyer For Further Assistance

Property insurance policyholders, like business owners, homeowners, condo associations, and real-estate developers, are frequently put into a vulnerable position by their insurance companies. This happens when they are denied a valid property damage claim or only pay out a part of the amount owed due to the anti-concurrent causation clause. It can be challenging to get the insurance company to pay a reasonable amount for the damages. Some reasons include:

  • The insurer can cite the anti-concurrent causation clause if one is in the policy.
  • They could claim that the damage was caused by a peril not listed in the insurance policy.
  • They can also deny your claim for no particular reason at all, just to save costs.

At Englander Peebles, we help policyholders involved in residential and commercial property disputes, no matter how complex they are.

Our team has years of combined experience they use to navigate complex disputes and is prepared to defend you if the case goes to trial. Our aggressive approach can help you get a fair settlement and make the insurance companies take your case seriously.

Contact us to schedule a confidential and free consultation with a skilled property insurance lawyer at Englander Peebles.

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