Our Miami homeowners insurance coverage lawyers recognize that many people who have a basement in their home are unaware that standard flood insurance policies exclude coverage for damage to their basement. Some people also have no idea that flood damage to the lower level of their home might not be covered by their policy because of the nuanced definition of the term “basement” under Write-Your-Own policies issued under the National Flood Insurance Program (NFIP). Because policies must conform to the language and terms dictated by the NFIP, this flaw in the protection of the lower level of homes from flood applies to many policyholders. Further, our Miami homeowners insurance claims lawyers want policyholders to be aware that flood policies are interpreted narrowly because the program is subsidized by public funds.
The First Circuit opinion in Matusevich v. Middlesex Mutual Assurance Company offers a cautionary tale for those who perform improvements like adding a patio, deck, swimming pool, or similar upgrades to their home. The insured purchased a Standard Flood Insurance Policy that included an exclusion for coverage of damage to the basement. Under the policy, a basement was defined as “[a]ny area of the building, including any sunken room or sunken portion of a room, having its floor below ground level (subgrade) on all sides.” Continue reading →