News & Thought Leadership from Sulloway & Hollis

June 16, 2020

Rhode Island Supreme Court Upholds Denial of Coverage for Property Damage by Water Heater

The Rhode Island Supreme Court issued its decision in Nelson v. Allstate Insurance Company, Supreme Court number 2019-166 (June 11, 2020). A copy of the decision can be found here. A summary of the Court’s decision follows:

Allstate issued a homeowners policy to the plaintiff. On May 6, 2017, plaintiffs water heater leaked and flooded the basement of her residence in Providence. Allstate denied plaintiff’s property damage claim. Plaintiff sued Allstate in the Superior Court. Finding the terms of the plaintiff’s homeowners insurance policy to be unambiguous, the Superior Court granted Allstate’s motion for summary judgment on the grounds that “[e]ven without a specific exclusion, the damage caused by the plaintiff’s malfunctioning water heater is clearly not one of the hazards articulated in the policy….”

In affirming the Superior Court’s award of summary judgment to Allstate, the Rhode Island Supreme Court once again stated that “[w]hile “this Court has clearly established that ‘[a] policy [deemed ambiguous] will be strictly construed in favor of the insured and against the insurer[,]’” id. at 1003 (quoting Derderian, 44 A.3d at 127), the Court “shall refrain from engaging in mental gymnastics or from stretching the imagination to read ambiguity into a policy where none is present.” Id. (quoting Koziol v. Peerless Insurance Company, 41 A.3d 647, 651 (R.I. 2012)).”

For more information about the decision or if you have any question about insurance coverage issues, please contact Sulloway Equity Member at 1-401-265-5151 or email David at