Wind-Driven Rain, Surge, and a 5% Hurricane Deductible
Your client owns a 1962 single-wall home in Kailua, Oahu, insured for $800,000 on Dwelling A. The policy has a 5% hurricane deductible, a $10,000 mold sublimit, and excludes flood and storm surge. During a named hurricane, wind broke a sliding glass door on the second floor. Rain entered and damaged koa flooring, drywall, and cabinets upstairs. Separately, storm surge flooded the ground-floor garage and a finished basement bedroom with eight inches of salt water. The insured submitted a $120,000 claim covering both areas and says the entire loss was from the hurricane. The adjuster's preliminary estimate allocates $70,000 to upstairs wind-driven rain damage and $50,000 to ground-floor surge damage. The insured has no flood policy. The policy contains an anti-concurrent causation lead-in. Your client wants to know what will be paid and how to document the distinction.
1. How should the claim be allocated between covered wind-driven rain damage and excluded storm surge, and how does the hurricane deductible apply?
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Start with the efficient proximate cause of each damaged area. Wind is a covered peril. Rain that enters through an opening created by wind is generally treated as part of the wind loss, not as flood, so the upstairs damage is the strongest covered portion. Storm surge is a flood peril and is expressly excluded. The eight inches of salt water in the garage and basement bedroom should be separated out. The anti-concurrent causation lead-in matters: if the policy excludes flood damage regardless of the sequence of causes, the surge portion and any mold caused by surge may be excluded even though a hurricane also produced wind. Do not let the carrier use the hurricane label to sweep the covered wind loss into the flood exclusion. The hurricane deductible is 5% of Dwelling A: 0.05 x $800,000 = $40,000. Apply it to the covered hurricane loss, not to the excluded surge loss. If the covered wind-driven rain loss is $70,000, the deductible leaves $30,000 before applying the $10,000 mold sublimit to covered mold remediation. The $50,000 surge portion should not erode the deductible or generate payment. Document causation room by room, with moisture readings, photographs, and an engineer's opinion if the carrier disputes the allocation.
2. What evidence should the public adjuster develop to support the covered portion and the mold sublimit?
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Build a causation file before negotiating numbers. Obtain the National Weather Service storm track and local wind and surge data for the property's elevation. Photograph and diagram the broken sliding door, the water path from the second floor, and the surge line in the garage and basement. Use moisture mapping and invasive opening where needed to show which drywall and flooring were wet by rainwater versus salt water. Preserve samples for chloride testing if surge contamination is disputed. For mold, document when moisture began, when the insured first noticed it, and whether the mold is in the upstairs wind-affected area or the surge-affected lower level. Get a hygienist's protocol and an itemized remediation estimate that separates covered wind-caused mold from excluded surge-caused mold. Obtain the insured's mitigation invoices, dehumidifier logs, and proof of prompt notice. If the carrier relies on anti-concurrent causation, request its specific policy language and a written causation position. The goal is a defensible allocation that supports the $70,000 covered loss, applies the $40,000 deductible, and confines the $10,000 mold sublimit to mold proximately caused by the covered wind loss.
3. How should the adjuster communicate the anti-concurrent causation issue to the insured without overpromising?
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Explain the difference between a covered cause and an excluded cause in plain language. Tell the insured that wind and rain entering through the broken door are likely covered, while surge is excluded, and that the policy's anti-concurrent causation wording may also exclude damage that cannot be separated from the surge. Avoid saying the entire claim will be paid. Present a range: the covered wind loss may be approximately $70,000 before the $40,000 deductible and mold sublimit, while the $50,000 surge portion is likely excluded. Explain that the deductible is applied only to the covered portion and that documentation may change the allocation. Put the explanation in writing, request the carrier's coverage position in writing, and reserve rights. If the carrier denies the wind-driven rain portion by labeling it flood, demand a room-by-room causation analysis and consider appraisal or consultation with coverage counsel if the dispute is purely about the amount or cause of loss. Keep the insured informed of deadlines and do not authorize permanent repairs before the carrier inspects.