4th Circ. Axes Bad Faith Award In Allstate Flood Coverage Suit

Law360, Los Angeles (May 3, 2017, 7:16 PM EDT) -- The Fourth Circuit on Wednesday reversed a lower court’s ruling that Allstate Insurance Co.’s denial of flood insurance coverage to a North Carolina couple was a “flagrant act of bad faith,” finding the suit was barred by the strict one-year statute of limitations for flood insurance claims.

Gary and Rebecca Woodson sued Allstate in February 2013 for breach of contract and unfair trade practices in North Carolina state court, after the insurer denied their claim in 2012 for damage caused to their home by Hurricane Irene.

However, the Fourth Circuit said regardless of the facts in that case, federal law unequivocally...

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