Cardio Diagnostic Imaging, Inc. v. Farmers Insurance Exchange

This case involves the interpretation of an insurance policy exclusion. The exclusion at issue excludes any “loss or damage caused directly or indirectly by . . . [wjater that backs up or overflows from a sewer, drain or sump.” The question is whether this exclusion applies to damage caused when a malfunctioning toilet failed to shut off the intake of water and, because there was a blockage in the sewer line, the toilet overflowed, causing water to leak into the business premises occupied by plaintiff and appellant Cardio Diagnostic Imaging, Inc. (Cardio). The trial court found that the language of the exclusion was unambiguous and that the damages Cardio suffered were excluded from coverage under the insurance policy issued to Cardio by defendant and respondent Farmers Insurance Exchange (Farmers). We agree. Accordingly, we affirm the summary judgment entered in favor of Farmers.

BACKGROUND

Farmers insured Cardio under a first party commercial property insurance policy. The policy includes a water exclusion that excludes damage caused directly or indirectly by “(1) Flood, surface water, waves, tides, tidal waves, overflow of any body of water, or their spray, all…