A state appeals court has ruled that New Jersey Transit is entitled to coverage up to its $400 million policy limit for water damage from Hurricane Sandy, rejecting insurers’ claims that a $100 million limit on flood-related coverage applies.

The panel upheld an Essex County Superior Court judge’s ruling that policy language providing coverage for a “named windstorm” applies to damage at the agency’s properties, and rejected claims by several of the agency’s insurance companies that policy language providing coverage for “losses caused by flood” applied to the damage.