Almost two years after Hurricane Harvey devastated parts of
Texas and Louisiana, Central America, and several Caribbean
islands, the coverage issues arising out of it are far from
resolved. The court decisions addressing these coverage issues have
not all been positive from the insured's perspective. In
particular, one recent decision in the United States District Court
for the Southern District of Texas, Pan Am Equities, Inc. v.
Lexington Insurance Company, No. H-18-2937 (May 2, 2019)
("Pan Am Equities"), should give insureds in
Texas and elsewhere pause heading into the 2019 Hurricane
Season.
The Dispute—Which Deductible Applies?
The insured in that case owned several commercial properties in
Houston, including an apartment building and parking garage that
sustained more than $6.7 million in flood damage as a result of
Hurricane Harvey. Its properties were insured by a commercial
property insurance policy that provided "Flood" coverages
as well as coverages for
