In Shemen v. Cincinnati Insurance Company, the United States Court of Appeals for the Third Circuit, applying New Jersey law, affirmed summary judgment in favor of The Cincinnati Insurance Company, reinforcing a straightforward principle: clear policy language will be enforced as written.
The case arose from property damage caused by heavy rainfall during Hurricane Ida. Cincinnati denied coverage under a standard water exclusion that expressly included “surface water,” and the district court agreed that the exclusion applied.
On appeal, the central issue was whether the water at issue qualified as “surface water.” The Third Circuit held that it did, relying on the term’s ordinary meaning—rainwater accumulating on the ground—and concluding that the policy language was clear and unambiguous. The insureds’ reliance on Sosa v. Massachusetts Bay Insurance Co. was unpersuasive. The court distinguished Sosa as involving a water main break and different considerations, emphasizing that the facts here fit squarely within the accepted definition of surface water.
While not precedential, the decision is a quiet but meaningful win for HKR and its client. It underscores that, under New Jersey law, courts will apply unambiguous terms as written—and that “surface water” continues to carry its plain and settled meaning in coverage disputes.