Making a determination as to whether you have a valid homeowner’s property insurance claim is a complicated question. Homeowners Property Insurance policies are riddled with exceptions, conditions, and exclusions that are designed to give the Insurance Carriers an out when a claim is made under a policy of insurance. On top of the general terms of the policy, many homeowners’ insurance carriers offer what are called “endorsements” in exchange for lower premiums. When Homeowner’s Insurance Carriers are competing for the homebuyer and the agent is trying to get the buyer the lowest possible premium, often what gets lost in translation is the actual terms of the policy itself! Now you can understand why many homeowners are not aware of what’s contained in there policy and what would be considered a covered loss.
There are many different homeowners’ insurance carriers out there all of which contain their own policies and language with regards to coverage in those policies. Generally speaking though, there are 5 different types of policies offered to homeowners in the state of Florida. For purposes of this article and determining if you have a valid homeowner’s insurance claim, we’ll be looking generally at HO-3 policies. An HO-3 policy or what’s known as an “open-perils” policy insures against all causes of damages unless specifically excluded from the policy. Don’t be fooled, the insurance business has been around a long time, long enough to have encountered many different causes of loss, and as I referenced above they have used this experience to their benefit.
HO-3 policies insure against the following causes of loss: Fire; Lightning; Smoke; Hurricane; Windstorm or Hail; Explosion; Riot or Civil Commotion; Aircraft; Vehicles; Vandalism or Criminal Mischief; Volcanic Eruption; Debris Removal, Temporary Repair; Theft; Falling Objects; Weight of Ice, Snow, or Sleet; Sudden and Accidental Discharge of Water or Steam; Freezing; Artificially Generated Electrical Currents; Wild Animals; and Collapse. On top of these general areas of coverage, most Home Owners Insurance Policies have a section entitled Additional Coverage; we’ll talk more about the additional coverage’s section later. Lastly, most Homeowners Insurance Policies specifically provide provisions for Personal Property, Loss of Use, and Liability Coverage.
But, as I mentioned above, Home Owner’s Insurance Policies are designed with built in defense mechanisms which are commonly known as exclusions, exceptions, conditions, and endorsements. To be honest, I’m a seasoned attorney, even sometimes when I read a policy I ask myself what’s going on here. For instance, the Additional Coverage section of most homeowner’s insurance policy explicitly states it will pay for the accidental direct physical loss to trees, shrubs, live or artificial plants, and lawns that are damaged by a peril insured against. However, under a completely different subheading, it goes on to say, we will pay reasonable expenses you incur for the removal of debris of covered property damaged by a loss insured, followed by: we will cover $1000.00 total for each loss for reasonable expenses you incur in the removal of tree debris or stumps. Is the policy capping tree debris removal and stump removal at $1000.00, for what was an otherwise already covered peril insured against? Let’s look at each one of these defense mechanisms individually.
The First built in defense mechanism is called an exclusion. An exclusion is a specific event in which the policy does not cover. Most policies have a section entitled “Exclusions” which starts off with a phrase that says we do not insure for loss caused directly or indirectly by the following; followed by an exhaustive list of specific occurrences that are excluded from the policy. For instance, I’ve read policies which specifically exclude accidental overflow of water or steam from within a plumbing, heating, air-conditioning, or fire protection sprinkler system while the home is unoccupied; they did this by adding the additional language stating “this section does not apply while the dwelling is vacant or unoccupied for 30 or more consecutive days”. What about the fact you bought a replacement cost policy. Does this exclusion apply if you were out of town for 30 days on business and returned to a flooded home? I can think of some arguments as to why it wouldn’t.
The Second built in defense mechanism is what I will term an exception. An exception is a specific scenario as to when an excluded loss is covered. An example of an exception would be a policy that says that it doesn’t cover loss caused by fungi, bacteria, or mold but then within the exclusion paragraph says a direct loss caused by a peril insured against resulting in fungi, bacteria, or mold is covered. This means that they have carved out an exception to cover fungi, bacteria, or mold remediation when it coincides with a covered peril, whether that’s fire, wind damage, or any other covered peril pursuant to the policy. Exceptions are littered throughout your policy, so be sure to read carefully.
The third built in defense mechanism is what we call conditions. Conditions are built in procedural requirements that insurance carriers attempt to use a bar to recovery. Most conditions are typically found in the “Conditions” section of the policy. One common condition is what we call the duty to mitigate. Most policies state in case of a loss to covered property, the insurance carrier has no duty to provide coverage unless you take reasonable emergency measures that are necessary to protect the property from further damages. However, courts have found your duty to mitigate is not always a condition of recovery, in the event you failed to mitigate damages, courts have found that their must be a finding that the breach was material and the insurer must have been prejudiced by such breach. The Conditions section of your Homeowners Insurance Policy is something you’ll want to consult upon the filing of a homeowner’s insurance claim.
Lastly, we have what are called endorsements. Endorsements are technically amendments to the policy often offered in exchange for premium reductions, however, some endorsements are offered at an additional premium. Common endorsements include water damage caps, additional coverage for structure of the dwelling, additional coverage for repair in conformity with modern building requirements, and limits on personal property replacement. Before purchasing or accepting endorsements in exchange for a change in rates it’s important to research each type of endorsement and make a determination as to whether that endorsement is will act to your benefit and the likelihood of a potential claim relating to the subject the endorsement. Florida courts are clear that when the language of an endorsement is inconsistent with the body of the policy, the endorsement controls.
All in all, homeowner’s insurance policies are extremely technical documents. Many of the different insurance carriers use their own language and place limiting language throughout the documents. It’s always a good idea to read your insurance policy, however, If you believe you have an Insurance Claim as a result of personal property damage, it is wise to consult the services of an attorney, they can help you navigate the policy and guide you towards policy provisions that may be applicable given your situation. The major takeaway here is, in order to determine if you have a valid homeowners insurance claim is, you must read the policy.
