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The insurance industry won its second critical victory in three days on Hurricane Katrina-related issues when a federal Appeals Court panel accepted the industry’s interpretation of its contract language on wind- vs. water-related claims.

The 5th U.S. Circuit Court of Appeals in New Orleans–the same circuit that has decided other Katrina-related claim cases–on Monday affirmed a lower court ruling in Chauvin v. State Farm Fire & Casualty, holding that Louisiana’s valued policy law only applies if the total loss was caused by a covered peril.

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