A 90 year old red maple hangs over the insured’s house. One of the branches looks like it might fall, and if it does, it’s going to cause some major damage to the sun room. The insured knows this and is a diligent homeowner. One day the weather forecaster says major storms are coming through later in the week - wind and flooding are likely - so the insured hires a tree company to remove the limb safely in advance and also pays to get sandbags down on the low side of his property facing the river. The weather forecaster was right, a big storm came through, but the insured’s preventative actions worked - no damage.
Notable Timestamps
[ 00:15 ] - Now the insured wants his insurance company to reimburse him for the tree expenses and the sandbag expenses. He tells the adjuster, “I saved you from having to pay way more on repairs; I had wind coverage and I even had flood coverage. All I’m asking for is reimbursement of my costs.”
[ 01:40 ] - Of the three, only Tim is extra diligent.
[ 03:50 ] - Policies don't cover pre-storm expenses. Insurance policies typically cover fortuitous losses. The lack of coverage for preventative measures came up a lot during coverage.
[ 05:20 ] - Insurers have a duty to mitigate a loss, but there has to be a loss. It's a duty to prevent "further" damage.
[ 07:06 ] - So should insureds just let losses occur? It's a moral hazard...
[ 08:30 ] - Let's say a different tree branch fell on the house the day before & caused a covered loss. The removal of other branches would mitigate the loss, which would be reimburseable.
[ 10:37 ] - Could it be considered faulty maintenance if the insured DIDN'T prevent the foreseen loss?
[ 13:25 ] - Consider the insured asking the insurer if they would pay for a portable generator to prevent a pipe freeze. Insurance companies are allowed to pay for such a thing, if they wanted to.
[ 15:33 ] - Tim provides a recap of the scenario and the points above.
Your PLRB Resources
Pre-Storm Expenses To Protect Property - www.plrb.org/documents/pre-st...
Preventative Measures: Sandbagging - www.plrb.org/documents/preven...
PLRB, Duty to Protect Did Not Cover Removal of Fire Damaged Tree Where Dwelling Wasn't Damaged - PCQ.2018.08.01.jak.a - www.plrb.org/legacy-documents...
Employees of member companies also have access to a searchable legal database, hundreds of hours of video trainings, building code materials, weather data, and even the ability to have your coverage questions answered by our team of attorneys (www.plrb.org/container.cfm?co...) at no additional charge to you or your company.
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The views and opinions expressed in this resource are those of the individual speaker and not necessarily those of the Property & Liability Resource Bureau (PLRB), its membership, or any organization with which the presenter is employed or affiliated. The information, ideas, and opinions are presented as information only and not as legal advice or offers of representation. Individual policy language and state laws vary, and listeners should rely on guidance from their companies and counsel as appropriate.
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