New Jersey Supreme Court Upholds $400 Million Award for Superstorm Sandy Damages

Piggy bank surrounded by stacks of money

The New Jersey Transit Corp decision illustrates the significance of defined policy terms and the importance of understanding how policy sublimits may apply to a particular loss.

February 22, 2021
Kerianne E. Kane - Saxe Doernberger & Vita

In New Jersey Transit Corp. v. Certain Underwriters at Lloyd’s London,1 New Jersey’s highest court upheld an appellate decision2 finding that New Jersey Transit Corporation (“NJT”) was entitled to full coverage under its property insurance policy for damages caused by Superstorm Sandy.

In July 2012, NJT secured a multi-layered “all risks” property insurance program from eleven insurers for the policy period of July 1, 2012, to July 1, 2013. The policies covered all perils and damage to NJT’s property unless specifically excluded. The primary layer, issued by Lexington Insurance Company, provided the first $50 million of coverage. The second layer provided coverage up to $100 million, the third layer provided an additional $175 million, and the fourth layer provided coverage of $125 million, for a total of $400 million in coverage.

The excess layer insurers included Certain Underwriters At Lloyd’s, London, Torus Specialty Insurance Company, and several other carriers. All participating insurers’ policies included a standard policy form and separate endorsements, some of which were included in all policies and some of which were unique to specific insurers.

Ms. Kane may be contacted at kkane@sdvlaw.com



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