Classification of ‘Lowest Floor Above Ground Level’ at Issue in Superstorm Sandy Coverage Lawsuit

CAMDEN, N.J. — A federal lawsuit filed in New Jersey accuses Harleysville Insurance Co. of wrongfully denying coverage of Superstorm Sandy flood claim after the insurer refused to pay for damage that occurred below the lowest elevated floor of the property.

The Sept. 3 complaint seeks payment of more than $130,000 for damage to an Ocean City, N.J., office the plaintiffs say is located in a condominium that has no basement and, therefore, fits within the description of property covered under the Harleysville policy.

Castlemar Realty Investments, which owns the building, alleges that Harleysville mishandled its Sandy claim in “key …