Anti-Concurrent Causation: Insurer's Hidden Weapon Against Homeowners

Private insurance companies routinely bury in their multi-page insurance contract a clause that lets these companies off the hook when it comes to paying for property damage caused by wind. The insurance industry refers to this as its "anti-concurrent causation" clause.

State Farm, the nation's number one homeowner insurance carrier, provides an excellent example of the industry's use of this clause. Two weeks after Katrina's 125-150 mph hurricane force winds blew across the Gulf Coast, State Farm issued the following directive to its claims adjusters.

	"Where wind acts concurrently with flooding to cause damage to the insured property, coverage for the loss exists only under flood coverage, if available."
	State Farm Wind/Water Claims Handling Protocol September 13, 2005

State Farm insisted that the Anti-Concurrent Causation language in its policies excluded coverage of all wind damage wherever flooding contributed to the loss, regardless of the sequence of wind and flood damage. Thus, under State Farm’s interpretation, wind damage that would have been covered could suddenly become excluded if flooding occurred several hours later.

What does that mean?
If after Katrina's four hours of hurricane force winds of up to 150 mph that had hit the Gulf Coast before the storm surge reached its peak, if so much as a single 2 x 4 were left standing on a property and the water that finally came ashore pushed it over, the insurance company would not pay a penny on the homeowners' policies regardless of the amount of damage and destruction hurricane force winds had caused.

State Farm's written policy demonstrates that the company had already determined that it would deliberately not pay one penny for any of the wind-related property damage so long as a single drop of water caused even as little as a penny's worth of destruction. Not ONE penny.

Is the anti-concurrent causation clause used industry-wide?
Yes, the anti-concurrent causation clause is used industry-wide. Going to State Farm's competitors like Allstate, Nationwide, USAA, and others will land property owners with the same "get-out-of-paying-your-claim" secret clause in the insurance policy contracts.

This is how insurance companies continue to rip off America's home and business owners from being paid on their legitimate wind damage claims. It is wrong. American home and business owners deserve better.

The Multiple Peril Insurance Act of 2009 is the solution to this homeowner nightmare.

I have proposed is the idea that you can buy your flood insurance from the federal government—that stays as is. And you can buy an option on your flood insurance to cover wind. So that whether the wind did it or the water did it, if you come home to a slab, or if you come home and your home is substantially damaged or destroyed, it doesn’t matter.

If you built it the way you are supposed to, if you paid your premiums and the storm gets it, you’re going to get paid. You don’t have to hire a lawyer. You don’t have to hire an engineer. You don’t have to wait years to get the check that you should have gotten within days.

Rep. Gene Taylor

One policy. One premium. One claims adjuster. Protecting America's home & business owner. Protecting America's taxpayers.

Rep. Taylor's Multiple Peril Insurance Act of 2009 solves the wind/water debate through permitting America's home and business owners to purchase one policy for both types of property insurance coverage.

Coastal America's Homeowner Insurance Crisis

Multiple Peril Insurance Basics
Water/Wind Dispute: The Eye of the Insurance Storm
The Insurance Industry's Inherent Conflict of Interest
Anti-Concurrent Causation: Insurer's Hidden Weapon Against Homeowners
Evidence of Insurers' Defrauding National Flood Insurance Program (NFIP)
Insurers Outsourced Their Cost of Living Expenses to American Taxpayers
Insurance Executives: Pocketing Premiums, Padding Profits, & Passing Out Big Salaries and Bonuses
Insurance Companies Exempt from Nation's Anti Trust Laws

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