A U.S. District Court judge on Tuesday ruled a Mississippi couple’s homeowner policy did not give them coverage for damage from flooding caused by Hurricane Katrina, in a major win for the insurance industry.

Paul and Julie Leonard were awarded $1,228 to cover wind damage but lost their argument that their Nationwide Mutual Insurance policy covered flood damage associated with the storm, which they said cost them more than $130,000.

The case has been closely watched by thousands of homeowners who believe damage from floods swept in by Katrina along the U.S. Gulf coast should be covered under policies generally meant to cover hurricane damage.

Mississippi District Court Judge L.T. Senter said the Leonards, whose house took in 5 feet of water, should have read their policy more closely.

“The plaintiffs are bound by the express terms of the policy, even if their interpretation of the policy was incorrect and even if the inferences they drew from the conversations they had with (insurance agent Jay) Fletcher were erroneous,” Senter wrote.

Analyst Douglas Pawlowski of Fitch Ratings was cautious in giving too much weight to any precedent the case set.

“I think this is obviously very favorable (for the insurance company). I am not sure we can bank on the final outcome” for the industry, he said.

Lawyer Zach Scruggs, who represented the couple and whose law firm has another 1,500 or so Katrina insurance cases in the works, said the wind damage payment was important.

“A win is a win,” he said, adding that there were “very good parts of that ruling” regarding how water and wind damage were accounted for.

He also pointed to rulings that the insurance company had the burden of proving what portion of the total loss was attributable to water and that policy provisions that aim to exclude coverage entirely for a combination of wind and water damage were ambiguous. Scruggs said that would be helpful in future court battles.

Nationwide urged policy holders to read carefully.

“We are very pleased that the court ruled in our favor and upheld the long-standing flood exclusion language which is foundational to traditional homeowner policies across the country,” it said in a statement.

Nationwide said it has paid $225 million in Katrina-related claims. Shares of parent Nationwide Financial Services Inc. rose 47 cents or 1 percent to close at $46.69 on the New York Stock Exchange.

Katrina cost insurers about $41 billion in claims, the largest event in the history of the industry, with homes accounting for nearly half of the total. More than 100,000 homes were damaged or destroyed by Katrina in what has been called the worst natural disaster in U.S. history.

The National Flood Insurance Plan paid another $15.3 billion.

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