The insurer issued an all-risk insurance policy to the insured. During a tropical storm, the insured partially emptied his family’s in-ground swimming pool because it was overflowing. The following day, the insured discovered that the pool had lifted out of the ground.

The policyholders filed suit for breach of contract, and the insurer denied on the  Water Exclusion provision of the policy (very similar to std. exclusion) that provided:

We do not insure for loss caused directly or indirectly by any of the following. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss.


 Water Damage,meaning:

 (1) Flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind;


 (3) Water below the surface of the ground, including water which exerts pressure on or seeps or leaks through a building, sidewalk, driveway, foundation, swimming pool or other structure.

 The policyholders argued that the damage was covered under the ensuing-loss provision in the policy.  In response to competing summary judgments, the trial court found that the direct cause of the damage was the pool shell coming out of the ground, rather than the hydrostatic pressure, even though there appeared to be an agreement of competing experts on this point.

Reviewing the matter de novo, the Appellate Court agreed with the insurer finding the policy’s plain language excluded the damage, and it was not an ensuring loss.



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