N.J. Court rules Sandy ‘storm surge’ damage not limited by insurance policy flood language

By Matt Rooney | The Save Jersey Blog

We got a ruling this week from Essex County Superior Court Judge Thomas Vena, Save Jerseyans, one pertaining to insurance coverage in the Hurricane Sandy aftermath that’s certain to raise eyebrows. 

Jersey Shore storm surge damage as seen from Governor Christie's helicopter on October 30, 2012.
Jersey Shore storm surge damage as seen from Governor Christie’s helicopter on October 30, 2012.

“In sum, the applicable language of PSEG’s policy, canons of contract interpretation, the extrinsic evidence proffered by both parties, as well as the relevant case law, all point to the conclusion that storm surge losses are not subject to the flood sublimits,” Judge Vena said in his ruling granting summary judgment for PSEG and denying a cross-application filed by insurance companies.

Until now, New Jersey courts had never definitively decided whether “storm surge” is included in an insurance policy’s flood definition. Consequently, Judge Vena’s ruling could impact hundreds of millions of dollars in claims as well as impact New Jersey storm-related insurance disputes well into the future.

I won’t go full legal nerd on you at the moment. For more details and analysis pertaining to Public Service Enterprise Group v. Ace Insurance, click here to read a full report from the New Jersey Law Journal.