Recently a friend acquired a top of the line brand new GE dishwasher.
Shortly after installation, a hose let go inside the dishwasher (part
of the assembly) and water poured out resulting in considerable damage
(thousands $$$) to flooring and the ceiling of a room below.

The homeowner went back to the dealer and asked if he could be
compensated for the damage caused by this new machine. He was told to
go talk to his insurance company about coverage under his homeowner's
policy.

My question: Do manufacturers of appliances have a responsibility to
pay for damage caused by faulty appliances? If so, where can I see
examples of how to proceed to recover losses?

My 10-year-old GE dishwasher's warranty excludes such liability in these words:

"This warranty does not cover... incidental or consequential damage to
personal property caused by possible defects with this appliance."

I suggest that your friend check the warranty for a similar phrase.