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A pair of plastic surgeons in New Orleans, La., who are facing more than $1 million in uninsured home losses from Hurricane Katrina, are suing State Farm Insurance, claiming the company did not tell them they could have bought additional coverage from other carriers, the Associated Press and New Orleans Times-Picayune reported.

Though their home was worth $1.4 million, Scott Sullivan and Michelle Cooper had just $250,000 in flood insurance on the property and another $100,000 in contents coverage, attorney Robert Manard said.

The flood coverage, which comes from the federal government, was at the maximum available level. The government relies on State Farm and other private companies to sell the policies. However, a handful of private insurers in Louisiana sell excess flood coverage.

Manard said Sullivan and Cooper didn’t discover such coverage was available until after Katrina sent 4 feet of water through their home, destroying 80 percent of the house and about $500,000 in furnishings and other personal property.

“They were told that’s all they could buy,” Manard said.

State Farm representatives declined comment, saying the company’s policy is to not comment on pending litigation.

Companies began selling the coverage about four or five years ago, according to the Insurance Information Institute. Some insurers won’t sell the coverage unless a client also buys a homeowners policy. Limits range from $250,000 in additional dwelling coverage to $75 million.

State Farm does not sell the extra coverage.

The suit was filed in civil district court in Orleans Parish and asks for class-action status. Manard said that if a judge rules the suit a class-action, it could include about 1,000 people facing about $500 million in uninsured losses.

Topics Lawsuits Flood Excess Surplus