An Insured’s Initial Burden of Proof in an HO3 Policy is to Show a Loss Occurred During the Policy Term – The Net Effect: More Jury Issues
Dec 3, 2014
By Maria Elena Abate, Esq. and Amy L. Koltnow, Esq.
In Mejia v. Citizens Property Ins. Corp., (Nov. 26, 2014), the Second District Court of Appeal ordered the parties to re-try a sinkhole case before a jury because the trial court erroneously ruled the insured had the initial burden of showing that the damage to the home was caused by sinkhole during the policy period. The court held that Citizens Property Insurance Corporation’s (“Citizens”) HO3 policy was an “all risks” policy. The insured, therefore, has the burden of proving only that a property suffered a loss while the policy was in effect. The burden then shifts to the insurer to prove the cause of the loss was excluded from coverage under the policy’s term. The court held that it made no difference whether the sinkhole coverage was added as a covered peril in an endorsement to the underlying policy.
The appellate court further held the insured had the right to introduce evidence of the amount of fees paid to the engineering firm that Citizens hired as an expert witness during the past three years. Evidence of a party’s financial relationship with its expert is relevant to show the witness’ bias.
The concurring opinion notes that over the years, the HO3 policy has morphed into an “amalgam that is neither an all risks nor a named peril form.” Nevertheless, the only practical solution is to place the burden on the insurance company once the insured has established the requisite physical damage to the insured dwelling during the term of the policy.
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