When searching for a homeowner’s insurance policy, many Rhode Island homeowners seek out the lowest premium or highest policy limits without paying much attention to the details of what types of losses are covered or excluded from a particular policy. In the event of an incident involving damage or loss, a homeowner may be denied coverage for some type of loss that they thought or assumed would be included in their policy. A recent decision by the Rhode Island Supreme Court demonstrates this scenario.
According to the court’s opinion, the plaintiff was a homeowner who purchased an insurance policy from the defendant. In May of 2017, the plaintiff’s water heater ruptured and caused flood damage to their home. Believing that the damage was covered by the homeowner’s policy, the plaintiff made a claim with the defendant which was denied. The plaintiff sued the defendant in district court, alleging that the policy included coverage for damage from the incident. The district court reviewed the insurance policy and determined that the text of the policy included an exclusion for water damage caused by a malfunctioning appliance in the dwelling and determined that the defendant was justified in denying the plaintiff’s claim.
The plaintiff appealed the ruling to the Rhode Island Supreme Court, pointing to language in the policy providing coverage for sudden, accidental, and direct physical loss caused by fire, explosion, or theft resulting from a flood or other water-related incident. The plaintiff claimed that the damage caused to their home should be covered under this provision, as the water heater exploded prior to the flooding. The high court denied the plaintiff’s arguments, finding that the clear and unambiguous language within the policy excluded any water damage resulting from a defective or malfunctioning appliance, and that the provision affording coverage to damage incident to flooding did not afford coverage for the type of damage reflected in the plaintiff’s claim.