The time period “floor water,” when searched on this weblog, ends in 87 totally different posts. Insurance coverage protection nerds love this time period. Its which means could be argued in so many various methods. The strategies of argument can use many various interpretation methods. The Supreme Judicial Courtroom of Massachusetts made the next ruling on the time period final week: 1
We conclude that the which means of ‘floor waters,’ and thus the definition of ‘Flood’ beneath the insurance policies, is ambiguous in regard to the buildup of rainwater on roofs. The uncertainty within the case regulation in Massachusetts and different jurisdictions confirms this ambiguity. Certainly, the conflicting interpretations of the time period ‘floor waters’ are a direct results of the time period’s ambiguity. As we should resolve such ambiguity in favor of the coverage holders and in opposition to the insurance coverage corporations that drafted the insurance policies, we conclude that the definition of ‘floor waters’ doesn’t embody the rainwater that landed and collected on the rooftop courtyard and parapet roofs on this case, or at the least it doesn’t unambiguously embody such accumulation of water on a roof.
I famous this case final December in “Can a Flood Occur on the Prime of a 10-Story Roof? What Is Floor Water?” the place I acknowledged:
My curiosity in ‘floor water’ has formally reached new heights – or ought to I say depths? It’s just like the mysterious character in a detective novel that retains popping up the place you least anticipate it. I’ll be diving into this frequent water harm protection battle with the keenness of a child in a puddle. Anticipate splashes of perception and possibly even a number of ripples of laughter as we discover this subject over the subsequent week. Get your rain boots prepared as a result of we’re about to wade by some severely murky insurance coverage waters!
I then wrote about United Policyholders submitting an amicus transient on the case in Defining Floor Waters: United Policyholders Argues {That a} Flood Does Not Occur on a Roof. United Policyholders creatively cited Zurich’s personal web site for a part of its argument. I acknowledged:
United Policyholders claimed that the case is an instance of ‘inventive denials’ on water claims based mostly on strained constructions of coverage language and that that is occurring throughout the nation. I agree that insurers are extra continuously battling their policyholders making an attempt to cut back funds on water losses.
In What Does “Floor Water” Imply? NAPIA Recordsdata an Amicus Transient in a Authorized Combat Over Its That means, I wrote a put up in regards to the amicus transient filed collectively this previous March by the Nationwide Affiliation of Public Insurance coverage Adjusters and the Massachusetts Affiliation of Public Insurance coverage Adjusters. Their transient argued partially:
NAPIA’s and MAPIA’s curiosity within the end result of this enchantment is substantial and direct. Insurers typically invoke the ‘floor water’ exclusion and, as this enchantment demonstrates, search to impermissibly develop its scope and software. NAPIA and MAPIA search to acquire readability on the correct reaches of the ‘floor water’ exclusion such that it’s interpreted in accordance with its language and intent. Water which doesn’t attain, contact or emanate from the bottom, however as a substitute swimming pools on a rooftop floor, ought not be handled or characterised as ‘floor water’ and thus shouldn’t be topic to the ‘floor water’ exclusion. Permitting such an expansive interpretation of the ‘floor water’ exclusion could be detrimental to Massachusetts policyholders.
The courtroom ruling supplied the framework for the way Massachusetts interprets a property insurance coverage coverage:
Interpretation of an insurance coverage contract is a pure query of regulation… ‘If the language of an insurance coverage coverage is unambiguous, then we construe the phrases of their traditional and atypical sense.’ … We additionally ‘contemplate what an objectively affordable insured, studying the related coverage language, would anticipate to be coated.’…. ‘Nevertheless, if the coverage language is ambiguous, ‘doubts as to the meant which means of the phrases should be resolved in opposition to the insurance coverage firm that employed them and in favor of the insured.’ …’This rule of development applies with explicit power to exclusionary provisions.’…
As now we have beforehand defined, ‘[a]mbiguity just isn’t created by ‘the truth that the events disagree as to [a term’s] which means,’ ’ …however moderately ‘a time period is ambiguous the place ‘it’s vulnerable of multiple which means and fairly clever individuals would differ as to which which means is the correct one,’ ’ …quoting Financial institution v. Thermo Elemental Inc., 451 Mass. 638, 648, 888 N.E.2nd 897 (2008) (time period is ambiguous ‘the place the phrasing can help an inexpensive distinction of opinion as to the which means of the phrases employed and the obligations undertaken’). (circumstances and citations omitted)
The courtroom made a number of attention-grabbing feedback throughout its evaluation. First, it famous that “Each events suggest what look like believable interpretations based mostly on the coverage language alone.” That is fairly essential as a result of it signifies that the time period is ambiguous if there are two or extra affordable interpretations.
Second, the courtroom regarded to case precedent, discovering that “Our overview of the case regulation exterior of Massachusetts additionally reveals no ‘constant interpretation’ of whether or not floor waters embody rainwater collected on a roof.” This case overview discovering, much like my analysis, led to this assertion by the courtroom:
Based mostly on this overview, we conclude that there isn’t a constant interpretation within the case regulation relating to whether or not the time period ‘floor waters’ contains rainwater accumulating on a roof. Reasonably, two totally different affordable interpretations of the time period ‘floor waters’ emerge, a broader interpretation that features rainwater accumulating on a roof, as exemplified by the First Circuit’s dialogue in Nova, 726 F.3d at 39-40, and a extra slim interpretation that may exclude water not on the bottom or the floor of the earth, as our choices in Boazova, 462 Mass. at 354, 968 N.E.2nd 385, and Surabian Realty Co., 462 Mass. at 718-719, 971 N.E.2nd 268, suggest however don’t determine. Accordingly, the case regulation confirms and doesn’t resolve the anomaly current within the coverage language itself, which, as mentioned above, doesn’t embody a definition of floor water, or in any other case tackle whether or not the buildup of rainwater on roofs is or just isn’t ‘floor waters.’
In sum, we conclude that it’s ambiguous whether or not rainwater accumulation on roofs constitutes ‘floor waters’ throughout the which means of the insurance policies. In evaluating such accumulation, the time period ‘floor waters’ as used within the current insurance policies is vulnerable to 2 meanings, and fairly clever individuals might differ as to which which means is the correct one. See Vermont Mut. Ins. Co., 490 Mass. at 164-165, 189 N.E.3d 306. Our conclusion that this language is ambiguous is confirmed by the inconsistency within the case regulation, which flows naturally from this ambiguity. As we should learn any such ambiguity within the insurance policies in favor of the coverage holder, we accomplish that within the immediate case. See Inexperienced Mountain Ins. Co., 484 Mass. at 233, 140 N.E.3d 418 (rejecting insurer’s proffered ‘expansive studying’ of insurance coverage coverage time period as a result of such studying ‘would defeat our long-standing precept of strictly construing exclusions from protection in opposition to the insurer’).
…
We reply the reported query as follows. Rainwater that lands and accumulates on both a constructing’s second-floor out of doors rooftop courtyard or a constructing’s parapet roof doesn’t unambiguously represent ‘floor waters’ beneath Massachusetts regulation for the needs of the insurance policies at problem on this case. We additionally report that any such ambiguity as to the meant which means of the phrases should be resolved in opposition to the insurance coverage firm that employed them and in favor of the insured.
There at the moment are 88 search outcomes for the time period “floor water.” My wager is that there shall be extra to return.
Thought For The Day
I do know that you just consider you perceive what you suppose I mentioned, however I’m undecided you understand that what you heard just isn’t what I meant.
—Robert McCloskey
1 Zurich Am. Ins. Co. v. Med. Properties Tr., Inc., No. SJC-13535, 2024 WL 3504060, at *2 (Mass. July 23, 2024).