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2018 GA Legislative Session Adjournment Report

Posted on: May 4th, 2018

By: Allan J. Hayes

The Georgia General Assembly adjourned sine die the 2018 legislative session late night on March 29. What follows is a list and summary of all bills tracked by FMG this session. Governor Nathan Deal must sign or veto legislation within 40 days after sine die adjournment, or it becomes law without his signature.

The legislative session has been over for a month now and the Governor will begin signing bills (and rejecting some) on Wednesday, May 2. After the Governor takes final action on all this legislation, we will give you an update on the fate of the following bills:

 

Health

SB 118 amends the age limit on the current autism coverage statute (O.C.G.A. § 33-24-59.10). As finally passed, the bill requires coverage for an individual covered under a policy or contract who is 20 years of age (previously 6) or under. Also, as amended the bill removes the requirement that coverage for prescription drugs for the treatment of autism spectrum disorders shall be in the same manner as coverage for prescription drugs for the treatment of any other illness under the policy, and increases the annual limit on ABA to $35,000

HB 818 provides that contracts between a health insurer or its contracted vendor or a care management organization and a health care provider shall not contain restrictions on methods of payment to the provider in which the only acceptable payment method is a credit card payment. Prior to initiating or changing payments to a health care provider using electronic funds transfer payments, including virtual credit card payments, a plan shall notify the provider of all fees associated with a payment method, and provide clear instructions as to how to select an alternative payment method.

HB 783 provides for modernization and updates of the Official Code of Georgia Annotated for purposes of conformity. Also provides that any assets of the Commission on the Georgia Health Insurance Risk Pool existing as of June 30, 2018, shall devolve by operation of law and without further action on July 1, 2018. Any liabilities and obligations of Commission 2018, shall be transferred to and assumed by the State of Georgia, by such instruments as may be required to maintain the same.

HB 769 amends statutes regarding institutional and hospital pharmacies regarding remote order entries.  Provides that remote orders must be made by a pharmacist licensed in the state but does not have to be in the state. Authorizes remote orders when the licensed pharmacist will be physically present in the hospital pharmacy within 48 hours (previously 24) and removes the requirement that at least one licensed pharmacist be physically present in the hospital pharmacy.  Also provides for the establishment of the Rural Center for Health Care Innovation and Sustainability, revises provisions relative to certificate of need, establishes micro-hospital definitions, and provides a grant program for insurance premium assistance for physicians practicing in medically underserved rural areas of the state.

HB 64 requires any carrier that issues a health benefit plan in this state through an agent to pay a commission to such agent and shall not structure such commission in a way that directly or indirectly discriminates in the amount of compensation paid to such agent for the sale of a group health benefit plan or for the sale of an individual health benefit plan. Such commission shall be structured to compensate the agent for the first term and for each renewal term thereafter, so long as such agent reviews coverage and provides ongoing customer service for such plan; provided, however, that no such compensation shall be required for any individual health benefit plan sold during a special enrollment period. This shall not apply to renewals of any individual health benefit plan sold during a special enrollment period that renews during the open enrollment period. Nothing shall be construed to require a carrier to pay a commission to an agent who is employed by such carrier.

HB 782 authorizes the Georgia Drugs and Narcotics Agency to request prescription information to a prescription drug monitoring program operated by a government entity in another state or an electronic medical records system operated by a prescriber or health care facility, provided the program or system, as determined by the department, contains legal, administrative, technical, and physical safeguards that meet or exceed the security measures of the department for the operation of the PDMP.

HB 513 allows the Department of Community Health to promulgate rules for a sign to be developed and posted at any medical facility, fire station, or police station to inform the public that the facility is an authorized safe place to leave a newborn child. This is to prevent injuries and deaths of newborn children who are abandoned.

HB 701 amends definitions for drug testing for state employment to allow testing for all forms of opioids. It shall not be defined as an “illegal drug” pursuant to a valid prescription or when used as otherwise authorized by state or federal law.

HB 769 implements recommendations from the House Rural Development Council relating to health care issues. The bill revises provisions relative to pharmacy practices, as well as provisions relative to credentialing and billing. This legislation provides for the establishment of the Rural Health System Innovation Center and the establishment of micro-hospitals. Also, HB 769 provides for a grant program for insurance premium assistance for physicians practicing in medically underserved rural areas of the state. The bill also increases the value of the tax credit to 100 percent related to contributions to rural hospital organizations.

SB 357 establishes the Health Coordination and Innovation Council of the State of Georgia. The council will create a forum for innovative ideas, evaluation, maximization of resources, and an organized health care approach.

SB 364 authorizes a higher supervisory ratio for physician assistants who have completed a board-approved anesthesiologist assistant program. No primary supervising physician shall have more than eight physician assistants who have completed a board-approved anesthesiologist assistant program licensed to him or her at a time.

Local Government

HB 257 streamlines the reporting process for local government authorities to file their statutorily-required reports to the Department of Community Affairs. It also narrows the dates of reporting from two dates to one.

HB 489 requires the use of the Georgia Procurement Registry for advertisement of bid opportunities for goods and services and public works construction contracts by a county, city, or local board of education. The registry will be free to use by the local government.

HB 618 is a bill to incorporate the city of Skidaway Island.

HB 626 is a bill to create the city of Sharon Springs.

HB 899 removes the disqualification of bidders without experience with the “construction delivery method” when awarding contracts for public works projects through sealed competitive bids.

HB 995 provides a process for a consultant to disclose any conflicts of interest when contracting for services with a local governing authority.

SB 263 authorizes a local referendum for the creation of the city of Eagles Landing.

SB 397 allows counties and cities to contract with real estate agents or brokers to market county or city-owned property.

SB 404 prohibits local governing authorities from charging a separate fee for standby water service for fire sprinkler systems.

HB 381 creates the ‘Abandoned Mobile Home Act’ to provide counties and municipalities with the authority to appoint an agent to determine the condition of a mobile home and how to dispose of the property. The bill also establishes procedures for a landowner to follow if the landowner wishes to remove an abandoned mobile home from his or her property.

Insurance

HB 64 requires insurance carriers that sell health insurance through an insurance agent to provide the agent with a commission that is consistent with the amount proposed in the rates filed with the Department of Insurance.

HB 592 repeals the sunset on the compliance self-evaluative privilege for insurance companies. This privilege allows insurance companies to fix issues arising from an internal audit without suffering reprisal by regulators for the original mistake.

HB 754 allows a Georgia domestic insurer to divide into two or more insurers and allocate assets and obligations, including insurance or reinsurance policies, to the new company. It does so by creating a process that is distinct from a merger, consolidation, dissolution, or formation.

HB 760 allows property and causality insurers, at the time of policy renewal, to simply notify the insured of reduction of coverage in the policy without having to cancel the existing policy and offer a new one.

HB 878 allows insurers and/or insurance agencies to let their insureds cancel their policy over the telephone.

HB 938 provides for a limited credit insurance agency license for the specific purpose of selling credit insurance.

SB 350 updates Georgia law regarding the notice requirements for an insurance company or agent to their policyholders in the case of policy renewal to comport with federal law.

SB 381 provides that a non-admitted insurer domiciled in this state is deemed a domestic surplus lines insurer, if all qualifications are met, and can sell surplus line products in Georgia.

Criminal Justice

SB 369 authorizes the clerk of court to collect a $5.00 fee when an individual enrolls in a pretrial diversion program, and to submit those monies to the secretary-treasurer of the Peace Officer’s Annuity and Benefit Fund.

SB 407 constitutes the reforms and recommendations offered by the Criminal Justice Coordinating Council. The bill allows the Criminal Case Data Exchange Board to create rules concerning e filing in superior and state court criminal cases after January 1, 2019. In addition, all civil complaints in superior and state court are to be filed electronically after July 1, 2019.

HB 978 amends the Code relating to school buses to make it lawful for drivers who meet or pass school buses on a highway with separate roadways or a divided highway, including but not limited to, a highway divided by a turn lane. The bill also allows for the use cameras on school buses to be operated, maintained, or leased to a law enforcement agency and for the recorded images to be reviewed by the agent who provides this service to law enforcement. The bill further allows for placement of an automatic traffic enforcement device within a school zone after the school has applied for a permit from the Department of Transportation for the use of such device.

HB 419 expands the ability for local governments to regulate the ignition of fireworks through local noise ordinances. The bill adds Memorial Day weekend and Labor Day as holidays when local ordinance cannot prevent fireworks from being ignited; however, when areas of the state come under drought conditions, the governor can restrict the use of fireworks. Also, all dealers of fireworks must post the license authorizing the dealer to sell fireworks.

SB 17 allows for a local referendum to lower the initial time to allow for Sunday sales of alcohol from 12:30 p.m. to 11:00 a.m. for any licensed establishment that derives at least 50 percent of annual gross sales from the sale of food or a licensed establishment that derives 50 percent of annual gross income from the rental of rooms for overnight lodging.

Transportation

HB 930 creates the Atlanta-region Transit Link “ATL” Authority. This authority is attached to the Georgia Regional Transportation Authority (GRTA) for administrative purposes and will serve as the transit planning organization for the 13-county metro Atlanta region. The region is comprised of the counties currently under the jurisdiction of GRTA: Cherokee, Clayton, Coweta, Cobb, DeKalb, Douglas, Fayette, Forsyth, Fulton, Gwinnett, Henry, Paulding, and Rockdale Counties. The bill establishes the governance structure of the ATL, as well as funding mechanisms. The ATL oversees all transit planning, funding, and operations within the region.

Taxes

HB 658 extends the sunset date to December 31, 2053 for the eight percent hotel/motel tax allowed in a county where a coliseum and exhibit hall authority were created on January 1,1991.

HB 820 amends Article 2 of Chapter 5 of Title 48, relating to property tax exemptions and deferral, by adding a new section which allows a homestead exemption from the ad valorem taxes for municipal purposes in an amount equal to the amount by which the current year assessed value exceeds the adjusted base year value of the homestead.

HB 918 is the “Largest Tax Cut in Georgia History.” It includes the following changes:

  • 7.5 percent of adjusted gross income floor for medical expense deduction is extended through 2018 and applied to all taxpayers;
  • Net operating losses may be carried forward indefinitely, but may not be carried back to apply against prior year’s tax liabilities;
  • Entertainment expenses are no longer allowed as business deductions; House of Representatives End of Session Report
  • Transportation fringes and other transportation benefits are no longer qualified deductions for employers providing the benefits;
  • Eligibility of building improvements for a 15-year recover period is expanded;
  • Like-kind exchanges are limited to exchanges of real estate;
  • The definition of capital asset is revised by removing patents, inventions, certain models or designs, and secret formulas or processes;
  • Gains from investment in a Qualified Opportunity Fund can be temporarily deferred and permanently excluded if the investment is held 10 years; and,
  • Disaster tax relief provisions, that: allow write-off of hurricane losses; suspend limitations on deductions for charitable contributions made for hurricane relief; give victims penalty-free access to retirement funds; and, eliminate the requirement that personal losses must exceed 10 percent of adjusted gross income to qualify for deduction.

The bill also doubles the state income tax standard deduction to $4,600 for single filers, $3,000 for married filing separately, and $6,000 for married filing jointly. The top personal income tax bracket rate and the corporate income tax rate are reduced to 5.75 percent in tax year 2019 and 5.50 percent in tax year 2020. The rate reduction for 2020 is dependent upon the General Assembly passing a joint resolution affirming the change and the resolution being signed by the governor. The changes in this bill expire on December 31, 2025. The bill also states that there shall be no liability for title ad valorem tax fees when obtaining a replacement title on a vehicle that is not less than 15-years old when the commissioner of the Department of Revenue is provided proof that the title no longer exists.

Budget

HB 684 is the $26.2 billion Fiscal Year 2019 budget. Highlights include:

  • More than $160 million toward boosting K-12 education, graduation rates, college accessibility, and career training programs, including a $35.6 million increase to the Zell Miller College Scholarship fund, and $12 million to expand Georgia’s College and Career Academy network;
  • More than $16 million toward children’s mental health programs, including $10.3 million for psychiatric crisis centers, $2.4 million for mental health care for foster children, and $1 million for suicide prevention programs;
  • $3.875 million toward an improved statewide health care system, including $1.5 million toward Georgia’s Health Coordination and Innovation Council, $375,000 for the Rural Health System Innovation Center, and more than $2 million toward the creation of more than 100 new residencies and preceptorships for doctors and nurses;
  • $7.5 million toward combating the statewide opioid and addiction epidemic, including $3.5 million toward a statewide drug task force and $4 million toward local community grants for substance abuse and recovery centers;
  • $6 million toward autism treatment and care programs;
  • $10 million to improve school safety through local community grants, in addition to $1.6 million for student metal health awareness training;
  • More than $1.2 million toward targeted rural Georgia funding, including $737,000 toward rural economic development and $858,000 toward the Center for Rural Prosperity and Innovation.
  • The bond package includes $489.8 million for higher education projects including those at the Board of Regents, the Technical College System of Georgia, and Georgia Military College. The budget provides state colleges and universities with $351.5 million for 32 projects including MRR; $5.9 million for Georgia Military College to complete renovation and equip Jenkins Hall; and $5 million for Georgia Research Alliance (GRA) equipment and infrastructure. Finally, the bond package includes $114 million for 12 projects within the Technical College System of Georgia, including $25 million for facility major repairs and renovations and $12 million for college and career academies.
  • $250 million, or 21% of the bond package, is dedicated to transportation and infrastructure funding, including: $100 million for the fourth year of funding for the repair, replacement, and renovation of bridges; $12.5 million for rehabilitation and improvements on state-owned rail; $100 million to the State Road and Tollway Authority to fund transit needs across the state; and $35 million to match federal funds and continue the Savannah Harbor deepening project.
  • The budget recognizes $1.83 billion in motor fuel funds in the Department of Transportation to continue capital construction projects, as well as local maintenance and improvements.
  • Finally, HB 684 includes $20.2 million for the second phase of a two-year plan to increase foster care per diem rates for relative and child placement agency (CPA) foster care providers, which brings the rate to the USDA’s southeastern average. The budget also includes $3.6 million to provide a 2.5% increase in the per diem rate for child caring institutions (CCI) and child placement agency(CPA) administrative costs.

If you have any questions or would like more information, please contact Allan Hayes at [email protected].

Need a Lyft? Georgia Court of Appeals Decision Raises Coverage Questions for Ridesharing Services and Their Drivers

Posted on: February 19th, 2018

By: Connor M. Bateman

Most personal automobile insurance policies exclude coverage for damages that result from the ownership or operation of a vehicle used as a “public or livery conveyance.” Although typically undefined in the policy, this phrase has generally been understood to encompass vehicles that are “used indiscriminately in conveying the public, rather than being limited to certain persons and particular occasions or governed by special terms.”

The Georgia Court of Appeals recently weighed in on the scope of this exclusion in Haulers Insurance Co. v. Davenport.  In Davenport, the plaintiff sustained injuries in a car accident, sued the other driver, and served his uninsured motorist carrier (Haulers) with a copy of the complaint. At the time of the collision, the plaintiff was giving a ride to a female friend who would occasionally pay the plaintiff to drive her into town. There was no evidence, however, that the plaintiff ever offered paid rides to the general public. The Court of Appeals rejected Haulers’ argument that the policy’s public or livery exclusion barred coverage, reasoning that the exclusion was inapplicable absent evidence that the plaintiff “used his vehicle indiscriminately to transport members of the general public for hire, or regularly rented out his vehicle for hire.” The court recognized, however, that the exclusion would apply in cases where the driver “presents his services indiscriminately to the general public for hire.”

In light of the rising popularity of Transportation Network Companies (“TNCs”) such as Lyft and Uber, the coverage issues presented by this oft-forgotten exclusion should be carefully reexamined. TNC drivers, who use their personal vehicles to transport passengers, will often have no coverage under their personal policies due to the public or livery conveyance exclusion. This exclusion clearly applies to drivers actively transporting passengers and may even be triggered when the driver is simply using the ridesharing application to “troll” for potential customers. While some of these gaps have been addressed by commercial insurance policies provided by the TNCs, drivers may still be left without coverage in certain situations. For instance, although TNCs typically provide liability coverage for a driver who has the app turned on and is waiting to accept a ride, the TNC policies will not likely cover damages caused by someone or something else during that initial period. To account for this, the TNCs suggest that such damages may be covered by the at-fault driver’s policy or the TNC driver’s personal policy. However, the public or livery conveyance exclusion often extends to uninsured motorist, collision, and comprehensive coverage. And because courts have held that the public or livery conveyance exclusion applies when drivers “present their services” to the general public, the exclusion is arguably triggered even when the TNC driver is merely waiting for the application to connect to a customer.

Although the reach of this exclusion has yet to be fully examined in the context of ride-sharing services, these and other coverage issues will likely continue to arise. For additional information, please contact Connor Bateman at [email protected].

Beware The Egg Shell Plaintiff

Posted on: February 13th, 2018

By: Jared K. Hodges

Recently, a jury from a historically conservative venue in Georgia awarded $2.7 million to a man who claims he was injured in a 4 m.p.h. rear-end collision. This unusual verdict should serve as an expensive reminder to insurance carriers, adjusters, and their counsel that not all low-speed, minor property damage incidents are alike.

Plaintiff Art Smith was 31 years-old when he was rear-ended in his Toyota Camry by John Bishop, who was driving a Ford F-150 pickup truck. Both Smith and Bishop were stopped at a traffic light in Cobb County, Georgia, when Bishop testified he “rolled into” Smith. Smith’s vehicle incurred merely $1,400 worth of damage, and he told the responding officers he was OK, before leaving the scene of the accident on his own.

The next day, however, Smith began experiencing stiffness in his neck, and he went to the emergency room. Smith underwent physical therapy and an MRI scan that revealed herniated discs in his neck, before he ultimately received cervical fusion surgery.

While Smith’s rapid spinal deterioration and treatment seems excessive given his young age, what Bishop could not have known, was Smith had undergone prior treatments for neck injuries several years before the accident. In Georgia, as in many jurisdictions, it is a tenant in torts that “a tortfeasor takes a plaintiff in whatever condition he finds him. A negligent actor must bear the risk that his liability will be increased by reason of the actual physical condition of the other toward whom his act [is] negligent.” AT Sys. Se., Inc. v. Carnes, 272 Ga. App. 671, 674, 613 S.E.2d 150 (2005). As the Smith case shows, the egg shell plaintiff is alive and well.

So many claimants and plaintiffs contend they are “egg shell plaintiffs,” it is easy for adjusters and defense counsel to become immune to these allegations, especially when there is minimal property damage, as there was in this case. Yet, insurers, adjusters, and defense counsel should remember that a tortfeasor takes a plaintiff in the condition where he finds him. If, for example, a plaintiff has a history of neck injuries that makes his neck susceptible to injury, it is possible a jury could find the defendant responsible for all subsequent neck treatments, even from an apparently minor injury-causing incident.

If you have any questions or would like more information, please contact Jared K. Hodges at [email protected]

Look Mom, No Hands!

Posted on: January 24th, 2018

By: Seth F. Kirby

On January 22, 2018 a Tesla Model S slammed into a parked fire truck on California’s 405 near Culver City.  The driver of the Tesla stated that prior to the accident he had the car’s autopilot system engaged.  This is just the most recent in a series of accidents in which Tesla’s autopilot system has been implicated.   At present, Tesla’s autopilot system is limited to what it refers to as Traffic-Aware Cruise Control.  This feature, which is also provided by other car manufactures, allows the car to maintain a lane and speed up or slow down depending upon traffic conditions.  The system relies upon driver input to observe and avoid stationary objects, which may be the true culprit that resulted in the recent crash.  Interestingly, all Teslas are equipped to function autonomously, taking its passengers to a destination with no human interaction.  Such features are not yet enabled due to the need to obtain regulatory approval, and the features of the current systems have been changed several times to encourage drivers to be attentive when behind the wheel (i.e. requiring the driver to maintain their hands on the wheel).

The advent of various levels of autonomous driving presents challenges and opportunities for the insurance industry.  Theoretically, the implementation of autonomous vehicles over the next decade or longer will result in fewer accidents and injuries as computers will be more reliable and predictable drivers.  Of course, machines can have errors, and on the road at 60+ mph, errors can have drastic consequences.  This begs the question.  As vehicles become autonomous, who will the auto carrier be insuring?  The easy answer is that the policy is issued to the individual that owns the car, so clearly the carrier is insuring the individual for their potential liability. In many states, however, the insurance “follows the car” and covers bodily injury and property damage arising from the use of the vehicle no matter who (or what) is operating the vehicle.  If the autonomous car makes a mistake, the law presently considers the human driver to be responsible for the vehicle’s operation and the liability is placed on the driver.  That seems reasonable in our present environment in which driver interaction is required for the system to operate.  It may seem less reasonable once the systems become fully automatic.  At that point, the individual’s carrier is essentially insuring the machine and its software, effectively turning auto liability policies into product liability policies.

In the short term, the transition between human and computer controlled driving presents problems as it can lull the driver into a false sense of safety.  It appears that when the driver has less interaction with the driving process their attention wanes and they may fail to avoid obvious hazards.  This is no different than the problems caused by other forms of distracted driving (texting, eating, tuning the radio), it is just a new dynamic that is being added to the roadway.  Eventually, the human element may be removed from the equation, but whether that will result in a net improvement in vehicle safety remains to be seen.  I fully suspect that many aspects of auto liability insurance will need to evolve as technology begins to take over the wheel.

If you have any questions or would like more information, please contact Seth Kirby at [email protected].

Fire On the Mountain: Non-Replacement Valuation First Party Coverage Disputes Arising From Fire Policies

Posted on: November 16th, 2017

By: Richard E. Wirick

 

This blog, second in a series of three, deals with coverage issues arising from fire losses in the first party context which do not deal with dwelling replacement cost (loss settlement) disputes. The two main areas of remaining first party issues are (1) business interruption and (2) ingress/egress.

A. Loss of Use [Economic Losses]

Fire losses suffered by commercial, as opposed to residential, insureds, usually present loss of use issues. Policies purchased by businesses often contain coverages for loss of use. Unlike loss of use resulting from flood and water damage, loss of use resulting from fires have formed a fairly pro-insured trend throughout the country, and in California.

Business interruption coverage has been defined by California courts as follows. In Pacific Coast Engineering Co. v. St. Paul Fire & Marine Ins. Co., 9 Cal. App. 3d 270 (1970), the court of appeal stated that it was well settled that “[T]he purpose and nature of ‘business operation’ or ‘use and occupancy’ insurance is ‘to indemnify the insured against losses arising from his inability to continue the normal operation and functions of his business, industry, or other commercial establishment . . .’” The court went on to say that business interruption insurance (“BIC”) was to ‘indemnify the insured for any loss sustained by the insured because of his inability to continue to use specified premises  . . .[that is]  for loss caused by the interruption of a going business consequent upon the destruction of the building, plant, or parts thereof.’” One Texas court enumerated the purpose and time span of BIC when confronted with a restaurant policyholder’s windstorm loss. When the restaurant was rebuilt, it nevertheless did not return to the same volume of business for nine months. Lexington Ins. Co. v. Island Recreational Development Corp. 706 S.W. 2d 764 (Tex. App. 1986). The dispute was whether the BIC indemnified the policyholder just up until the time it reopened, or until the time it recovered its lost business volume. The Island Recreational court reasoned that since the policy did not explicitly exclude the period of recovery after the restaurant reopened, coverage continued up until the point that business was restored to its prior volume. Id. at 768.

Though no California cases have addressed this, a federal Third Circuit case examined a BIC loss for a medical imaging company. In American Medical Imaging Corp. v. St. Paul Fire & Marine Ins. Co., 949 F. 2d 690 (3d Cir. 1991), a diagnostic facility had purchased a business policy whose BIC provisions covered the “necessary or potential suspension” of operations, and required the carrier to indemnify the insured until it returned to “normal business operations.” (Emphasis supplied). The insured had reopened its CT/MRI operations at an entirely new location, but as quickly as possible. The Third Circuit held that relocation costs were recovered as part of the insured’s attempt to minimize its losses, and to deny indemnification for same would give the insured no incentive to mitigate.

B. Ingress/Egress Issues

California’s hilly terrain presents ingress and egress obstacles in the event of a fire loss. Are the costs of surmounting them covered under most BIC coverage parts? Most property policies cover losses when ingress to, or egress from, an insured premises is “prevented” because of a covered peril. Are losses from road closures covered? Again, one must look to other jurisdictions for guidance. In National Children’s Exposition Center Corp. v. Anchor Ins. Co., 279 F. 2d 428 (2d Cir. 1960), a court recognized that “prevent” could embrace the milder verb concept of “hinder.” Accordingly, if road closures hindered travel, this coverage part could provide indemnity.

Some extra-jurisdictional decisions have interpreted ingress-egress clauses even if the insured’s property (including private roads and driveways) were not destroyed by fire. In Fountain Powerboat Industries Inc. v. Reliance Ins. Co., 119 F. Supp. 2d 552 (E.D.N.C. 2000), an insured argued that a floodplain prevented ingress-egress to the insured’s boat-building business such that only heavy trucks could pass through. The insurer’s position was that since the insured’s actual facility had not been damaged, there was no coverage. The argument did not fare well with the court, which ruled “[T]he meaning of the ingress-egress clause is exceedingly clear. Loss sustained due to the inability to access the Fountain Facility and resulting from a hurricane is a covered event with no physical damage to the property required.” Id. Analogous arguments could be made for a fire loss.

If you have any questions or would like more information, please contact Richard E. Wirick at [email protected].