Tag: Coverage Alert

D & D Coverage Alert – Flex Your Power! – Public Utility Shut Off

October 10, 2019

The Utility Co. “Intentional” Electrical Power Outage to your Home or Business have some variance of coverage(s) and or exclusions(s)

First, the Utility Co. voluntary shut off of electricity is not considered a “Covered Cause of Loss”. Therefore, most coverages are not even considered because there is not a “Covered Cause of Loss”. i.e. like Fire.

Second, Utility Services from lack of power, failure of power, are excluded from policies.

The Home Policies have some Broaden Coverage & Exclusions:

  • Home Policy- Refrigerated Property: This is usually in most home policies. The coverage is broadened “If Power Interruption Occurs Off the Residence Premises” . There are financial indemnity limits of $500 to $5,000 with a lower $500 deductible.
  • Home Policy- Additional Living Expenses: Excluded. There are NO coverages for temporary hotel expenses.

The Commercial Property & Loss Income/Extra Expense, Spoilage & Civil Authority Coverages are Not applicable with intentional Utility Co’s decision to shut off services. These coverages are applied with  a “Covered Cause of loss”.

  • Commercial Policy-Spoilage: Power Outage eventually excludes “Intentional Decision of an Electrical Utility Co. (i.e. PG & E)
  • Civil Authority: For Business Income: There is no Coverage. There must be a covered cause to activate coverage. Also, the Utility Co. does not meet the definition of Governmental Authority.

On behalf of the Claims Department & Marketing VP Dirk Seltzer.

D&D Coverage Alert #2

June 10, 2019

When a Kid (aka: Employee) gets there hand caught in the cookie jar by their Parents (aka: Employer) this is defined as “Employee Theft”.  So if your employer has cash $$$ on hand or Business Property (i.e. Chocolate Chip Cookies) than make sure your Business Owners Policy or Commercial Policy has Employee Theft (aka: Crime Coverage). Employees taking cash or business personal property are typically excluded, even under broadening endorsements.

When the Kids friend (aka: non-employee) steals cash from the employers Piggy Bank, This coverage is called “Money & Securities”. The piggy bank dollar $$$ amount limits can be set differently for both on or off premises. So depending on how much money is in the mud pen or how much money the piggy flies off site with, will determine the limit values. The same coverage principles can apply. Might be excluded, even under broadening endorsements.

D&D Coverage Alert #1

June 10, 2019

Like back in 1949 during the California Gold Rush, we are now seeing a 21st Century boom in the new residential building industry. So the Insurance companies are tightening the reins on the mules.

Please double check and review the definition of “Project” for your sub-contractor or general contractor liability policies. When it comes to residential construction defect claims, we are seeing policy language, including “Project” endorsements that limit or exclude coverage. We are finding a limit on the number of Homes within the overall housing development.  Not to be confused with the total homes worked on by the Insured.

The “Project” is the TOTAL number of homes within the development. This includes ALL Phases, present and future. So if the insured is only contracted to work on 50 homes, but the Project has a total development of 100 homes, this endorsement could exclude coverage.

The intent of the endorsement is to limit the construction defect exposure. The higher the number of homes within the Project will increase the potential for construction defect lawsuits. That is why they limit the number of homes on the endorsement.

So please remember to double check the insurance application questions, policy language and recognize any “Project” endorsements.