Hurricane Katrina Victims Denied Insurance Claims

Tens of thousands of home and business owners who suffered catastrophic losses from flooding after the levees breached in New Orleans have been denied insurance reimbursements, and a U.S. Circuit Court of Appeals has sided with private insurers over the victims.

In a decision yesterday, the panel said the insurance policies did not cover flood damage, including damage from man-made disasters like the breach of the levees following Hurricane Katrina in 2005. Insurers would have been on the hook for $1 billion had they been made to pay, according to Robert Hartwig, president of the Insurance Information Institute, who was quoted by USA Today as saying the decision was "correct and fair."

It doesn't seem at all fair that tens of thousands of people whose lives were ruined, and who had sought insurance ahead of disaster, are now on the hook for that same bill. $1 Billion, even spread out among tens of thousands of people, will be an insurmountable goal for many who might otherwise have returned to rebuild their damaged communities.

The decision is also a warning to anyone living in a flood-prone or coastal zone: Check your policies, and be sure that the insurance you pay for is giving you the coverage you expect. The Federal Emergency Management Agency recently warned that many of the flood policies people took out after Katrina have expired -- and hurricane season is only now starting in earnest.

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Hurricane Katrina photos submitted by The Daily Green community to the Weird Weather Watch photoblog
Ruined Home after Katrina
House and Car after Katrina
Classroom after Katrina

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