Pillsbury Winthrop Shaw Pittman

New York state court allows policyholder to pay minimum deductible for flood loss

In a January 2014 decision that may prove valuable to policyholders in their disputes over deductibles, a New York state trial court ruled that the appropriate deductible applicable to an oil terminal operator’s $2.28m (£1.38m) Superstorm Sandy flood loss claim was the minimum deductible — thus rejecting the insurer’s position that the deductible should be calculated based on a percentage of the total value of the insured property, as such a construction would result in a $2.49m deductible and ‘render the flood damage sublimit… absolutely meaningless’.

Castle Oil Corporation, the owner and operator of a New York City fuel oil terminal with a total insurable value of $124.7m was insured by Ace American Insurance Company at the time of Castle Oil’s flood loss in October 2012. Ace’s all-risk commercial property policy had been endorsed with flood coverage subject to a $2.5m sublimit. An additional endorsement provided that the deductible for flood damage in special flood hazard areas would be ‘two per cent of the total insurable values at risk per location subject to a minimum of $250,000’…

If you are registered and logged in to the site, click on the link below to read the rest of the Pillsbury briefing. If not, please register or sign in with your details below.

Sign in or Register to continue reading this article

Sign in


It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer


Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.


Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.


Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.


Tower 42, Level 23
25 Old Broad Street