Pool’s Leaking Drainpipe Not Excluded from Coverage Under the “Water Damage” Exclusion

Mar 31, 2020

MARCH 2020

Florida Insurance Matters is a monthly update on Florida insurance-related legal developments by the Colodny Fass Insurance Litigation Practice, recently recognized as the Insurance Litigation Department of the Year in South Florida by the Daily Business Review.


Amy L. Koltnow, a Colodny Fass Shareholder, focuses her practice on representing insurance companies in complex insurance litigation and counseling insurers on claims resolution. She has represented insurers in connection with property damage and first-party coverage litigation, claims of “bad faith,” high-risk exposures, class actions and multi-district litigation.

For more information about Ms. Koltnow, click here.


Pool’s Leaking Drainpipe Not Excluded from Coverage Under the “Water Damage” Exclusion

Homeowners claimed their pool’s underground drainpipe leaked causing damage to their pool deck and surrounding structures. The insurer denied coverage and asserted defenses based on the policy’s “water damage” and “wear and tear” exclusions. The “water damage” exclusion precluded coverage for damage caused by water below the surface of the ground which seeps or leaks or flows through a swimming pool or other structure. The homeowners argued the “water damage” exclusion only applied to water pressure coming from outside, not a leak from within the plumbing system. The trial court granted summary judgment in the insurer’s favor. The appellate court reversed and held the “water damage” exclusion referred to naturally-flowing water exerting pressure from outside of the plumbing system, not a leak from within the plumbing system itself. Kokhan v. Auto Club Ins. Co. of Florida (4th DCA, March 11, 2020).


  • The appellate court interpreted the “water damage” exclusion consistent with the other subsections, which all referred to naturally-flowing water existing outside of the plumbing system.
  • The trial court did not consider the “wear and tear” exclusion, or whether the coverage for sudden and accidental escape of water from a plumbing system was an exception to that exclusion. That issue was left for another day.

No Obligation to Prepare a Privilege Log Until After Other Objections Ruled Upon 

Insurer appealed a trial court’s order compelling the production of its investigator’s photographs, which the insurer objected to on the grounds of being overly broad and work product privilege. The trial court ordered the production because the insurer failed to file a privilege log. The appellate court quashed the discovery order. The civil rules provide that a privilege log is required only when a party withholds information “otherwise discoverable”. Documents are not “otherwise discoverable” until after the court has ruled on a party’s non-privilege discovery objections. After the other discovery objections are ruled upon or resolved, the court should have allowed the insurer a reasonable amount of time to file a privilege log. Avatar Prop. & Cas. Ins. Co. v. Jones (2d DCA, March 13, 2020)


  • Florida law is well-settled that claim file materials are not discoverable in a first-party property insurance claim when the issue of coverage has not yet been determined—some courts have held these materials constitute “work product”, other courts have held the discovery is not “relevant”. 
  • The Third District also quashed a discovery order compelling the production of all documents in the field adjuster’s claim file created prior to the date of denial. The court did not reference the “work product “ privilege, but based its ruling on a blanket prohibition of an insurer’s claims files and claims handling materials. Anchor Prop. & Cas. Ins. Co. v. Yanes (3d DCA, March 4, 2020)
  • When “protected” claim file materials are sought, defense counsel should raise “relevancy” and any other applicable objection, in addition to work-product, without preparing a privilege log. After the court rules on the non-privilege discovery objections, counsel should then request a reasonable time to prepare a privilege log.