Volume 62, Issue 3, 757-794
The threat of natural disaster looms each year over many states in the U.S. Although major disasters are, in that sense, predictable, they nevertheless strike without warning. The private insurance industry has proven incapable of absorbing the risk. Adding to the problem is the fact that the law, in many states, allows insurance companies to skirt around disaster coverage by inserting anti-concurrent causation (“ACC”) clauses into their property insurance policies. Even in states where the law appears to bar such clauses, state programs aimed at increasing disaster insurance have failed to yield sufficient coverage to support the total amount in claims that would be produced following another Katrina-scale event. The extensive privation following Hurricane Katrina is proof-positive that America is not yet equipped to deal with large-scale natural catastrophe. Unfortunately, while the federal government can and does becomes the de facto “insurance plan” for all disaster-prone states, its response to past episodes has been ad hoc, at best.
This Note examines the concurrent causation question and takes a close look at the courts’ troubling treatment of ACC language following Hurricane Katrina. It goes on to contrast the stat of the law in the Gulf region with that of California, arguing that while California seems to have established a bright-line rule barring ACC clauses, recent decisions have brought the integrity of this rule into question. While California’s approach to the concurrent causation question could produce a workable solution for other disaster-prone states to observe, the California courts must first revitalize the rule barring ACC clauses, and the state must develop a solution to encourage more homeowners to purchase catastrophe insurance. Finally, the Note proposes a twopronged solution, advocating both a judicial response, as well as the reintroduction of the Homeowners’ Defense Act of 2009. By enacting the Homeowners’ Defense Act, the federal government can take a proactive, instead of reactive, approach to natural disaster relief.