STORY FROM: Superstorm Sandy Insurance Litigation

Destructive Mudslide Falls Within Policy’s Water Exclusion, 10th Cir. Affirms

DENVER — A mudslide that destroyed a building falls within a policy’s water exclusion and is therefore not covered, a federal appeals court has ruled, rejecting the insured’s argument that coverage is available under the exclusion’s “explosion” exception.

In an Aug. 29 opinion, the 10th Circuit U.S. Court of Appeals reasoned that the building did not “explode” but rather was destroyed by an external cascade of water.

A mudslide destroyed a commercial building in Boulder, Colo, owned by Paros Properties LLC and insured under a policy issued by Colorado Casualty Insurance Co.

CCI denied Paros’ insurance claim on ...

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