Though Hurricane Katrina struck the Gulf Coast nearly 18 months ago, the storm is still landing plenty of punches on insurance companies.

A verdict last month in the case Broussard v. State Farm not only held State Farm responsible for policy limits that totaled more than $220,000 on a loss it deemed due to storm-surge flooding, but it also put the company on the hook for $2.5 million in punitive damages. The devastating judgment could set a dangerous precedent for State Farm and other companies who supply the Gulf Coast region with homeowners’ insurance.

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