Some things, like meteors, could hit home hard

March 13, 2013

No one wants to see their house surrounded by cops on the evening news, either.

  POSTAGE  by Rob Stamp

It’s not every day when current events unfold and you wonder if you’d be covered for what might otherwise be considered the unthinkable. Would damage to your property be covered if it were struck by a meteor? Or how would a homeowner’s policy respond if authorities set the property ablaze?

Both of these questions were prompted by incidents that made headlines in February: the meteor that exploded over Russia, and the California cabin that burned down during an ex-Los Angeles cop’s standoff with police.

Most homeowners policies cover meteor strikes because most of these policies are written on what is considered an “open perils” basis. This means that the policy will cover any damage to buildings or structures that is not specifically excluded. There is no exclusion for direct hits by meteors and the damage caused by their sonic booms. Even in the case of personal property or occasional real property written on a “named perils” basis, there is usually the following or a similar peril that is covered by the policy: Falling objects.

This peril does not include loss to property contained in a building unless the roof or an outside wall of the building is first damaged by a falling object. Damage to the falling object itself is not included. The falling object would be the direct proximate cause of the sonic boom, and it should be covered there as well. In addition, there is usually a named peril for “explosion” and the rapidly expanding air that causes the sonic boom would likely fit that description. In the case of sonic booms from aircraft, there is usually a named peril for aircraft.

Insurance companies often cover things that are unlikely to happen — but every now and then, the unlikely happens. It seems fairly certain the homeowner will have adequate coverage if the boom gets lowered on his or her humble abode. As usual, damage would be subject to the deductible. And, most of us are aware that even minimum property deductibles these days represent a fairly sizeable chunk of change.

Now, let’s turn our attention to the highly-publicized California manhunt that ended up lighting up the night sky Feb. 12. Catching fire was a cabin that was believed to be where a fugitive ex-officer had barricaded himself. According to authorities, the police officials did not intentionally set the blaze, which erupted after they fired tear gas canisters that can emanate heat. And, it’s important to determine the officers’ intentions. That’s because there are governmental action exclusions in most homeowner and dwelling fire policies that could leave the property owner in a lurch.

If police caused damage to a property like that, would that be covered? It’s arguable, depending on how literally the referenced policy provisions are read. Did the government actually order the destruction? Or was it just trying to flush out the suspect, or provide cover for an assault — making the ensuing fire an accident? Or did the suspect himself set the fire? Coverage for a loss caused by an intentional act like arson can be denied, so you hope your insurance company does the right thing and doesn’t screw you by some cockeyed literal interpretation of the policy language.

What happened in this case is not akin to, for example, a governmental order condemning a property, something that is a primary source for the origin of this common policy exclusion.

Last month’s premiere of “Killing Lincoln” on the National Geographic Channel raised the question in my mind. It is widely believed that federal troops set on fire the barn where John Wilkes Booth was hiding. In watching the presentation, I couldn’t help but feel sorry for the poor farmer. Even if he had the barn insured — which, of course, he wouldn’t have in 1865 — his insurance company would have told him to go pound salt anyway, citing the exclusion.

So, in the unlikely event your house burns to the ground when the dogged coppers corner a dangerous criminal there, you do everything in your power to convince the authorities to state that the resulting fire was merely an accident, and not caused by some regrettable overzealous pursuit of justice.

Thanks to Bill Wilson, director of the Big “I” Virtual University, for allowing me to swipe some material used in this report.

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