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Flood victims fight Allstate over ‘ambiguous’ insurance policy

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In June 2005, Elmer and Alexa Buente bought their home and purchased a homeowner's insurance policy from Allstate Insurance Co. The policy was purchased from Allstate agent Brenda Pace who assured them the policy included hurricane damage coverage. In answer to their questions, Pace's assistant told the Buentes they did not need flood insurance because their house is not located in a flood plain. She noted the policy would cover any hurricane damage, subject to the "Hurricane Deductible" in the policy. Purchase Bob Bruss reports online. On Aug. 29, 2005, the Buente home was severely damaged by hurricane wind, rain and/or storm surge from Hurricane Katrina. When the insureds phoned Allstate's "Natural Disaster Hotline" the Allstate representative assured them their "storm surge" damage would be covered by their policy. Allstate's adjuster later determined the insured damage to the Buente home was $2,600, and Allstate tendered its check for that amount. But the Buentes contend their insu...