BATON ROUGE – An insurance company alleges it holds no responsibility for coverage for foundation damages caused by flooding.
United Specialty Insurance Company (USIC) has filed a declaratory injunction March 17 in U.S. District Court for the Middle District of Louisiana against Tara Corp alleging its policy explicitly does not provide coverage for damages on the foundations.
According to the complaint, USIC issued a commercial lines policy to Tara Corp for June 7, 2014-June 7, 2015, for a shopping center owned by Tara at 13559 Old Hammond Highway, Baton Rouge. The suit says policy provides building coverage with a limit of $1.5 million and a deductible of $1,000, including a business income/extra expense Including rental value coverage with a limit of $30,000.
On March 23, 2015, the lawsuit states, a water sprinkler pipe running beneath the foundation of the shopping center burst underneath a Family Dollar, causing water to come through the foundation and flooding Family Dollar. The flooding allegedly caused damage to the interior Family Dollar and may have caused damage to the foundation.
USIC says it covered the costs for the building damage, including issuing checks on May 29, 2015, for $134,073.18. However, USIC alleges, under provisions of the coverage provided to Tara, the plaintiff does not cover damages to or repairs for the foundations which includes the repairing pipes, land, drains, the cost of removing the slab to repair subterranean soil, repairing the soil and replacing the slab.
The plaintiff also alleges because Tara Corp. did not provide prod of actual business income loss, it is not obligated to provide any payment.
USIC asks the court to declare it does not owe any further payments to Tara Corp. and it is not obligated to pay the business income loss. USIC also seeks any other further relief including costs related to this case. It is represented by attorney Matthew W. Bailey from Irwin Fritchie Urquhart & Moore LLC in Baton Rouge.
U.S. District Court Middle District of Louisiana Case number 3:16-CV-00180-SDD-RLB