Third Circuit Finds for Insurer in Sandy Coverage Dispute over Debris Removal from Land outside Insured’s House

In a recent Third Circuit case, the Court affirmed the judgment of the District Court, which entered summary judgment in favor of an insurance company. Michael and Geraldine Torre appealed from the Order of the District Court, which held that Liberty Mutual Insurance Company was not responsible for covering expenses associated with removing debris not owned by the Torres from their land outside their house.

After the Torres’ home sustained substantial damage from Hurricane Sandy, they submitted claims under a Standard Flood Insurance Policy (“SFIP”) issued by Liberty Mutual. Liberty’s original payment included the cost of removing debris from the Torres’ house, but the Torres requested additional funds for the cost of removing sand and other debris deposited on their land in front of and behind their house. Liberty denied the claim and argued that the insurance policy only covered damages to the structures on the property, and not the land itself. The relevant provision in the policy stated that Liberty would “pay the expense to remove non-owned debris that is on or in insured property and debris of insured property everywhere.” The Torres argued that “insured property” covered not only the specific structures and items of property insured (such as their house), but the entire parcel of land. However, the Court disagreed with this argument, and pointed to the detailed language of the SFIP policy that expressly specified which property was and was not covered. Simply stated, the insurance policy clearly provided coverage for certain structures and other items of property, but not for an entire parcel of land. The Court concluded that the term “insured property” clearly and unambiguously referred to property insured under the SFIP, and that land was not insured under the polocy. Therefore, the SFIP did not cover “costs the Torres incurred in removing debris not owned by them from their land outside their home,” and the judgment of the District Court in favor of Liberty was affirmed.