"Simply the Vest" is a dry cleaning service with a basement full of supplies, tools, clothing, and… water. After a heavy rain, the owners discovered that their sump pump had failed, causing water to back up into the basement, resulting in damage to their property. Under their BP 00 03 form, coverage for this cause is firmly excluded. However, they paid for a supplemental endorsement with some interesting technicalities…
Notable Timestamps
[ 02:43 ] - When assessing coverage, always start with the underlying policy form before reviewing any endorsements, ensuring clarity on the initial coverage.
[ 05:32 ] - Supplemental coverages given to an insured typically identify specific needs that they have in the transaction and provide clear limits for each supplemental coverage provided.
[ 08:11 ] - Endorsements can provide additional coverage for water-related claims like backup and overflow or mold, which are generally types of losses that would otherwise be excluded.
[ 11:18 ] - Determining coverage requires looking at the exact policy language, fitting it to the specific scenario, and matching facts to the policy language.
[ 13:45 ] - Sump pump issues often involve power outages (necessitating battery backup) or mechanical breakdown, but each claim has to be assessed based on its individual merits.
[ 15:23 ] - An endorsement providing additional water backup coverage may also modify or replace the existing water damage exclusion found in the underlying BP policy.
[ 17:49 ] - If a loss isn't excluded under the underlying policy, the supplemental coverage-- which could be subject to a lower limit-- would not be needed.
[ 16:18 ] - Brennan provides a brief conclusion.
Your PLRB Resources
Coverage Question: Sump Pump vs. Septic Pump - https://www.plrb.org/documents/sump-pump-vs-septic-pump-pcq-2024-09-24-dwf-b
Property Question of the Week: Sewer Backup Coverage vs. Flood Exclusion - https://www.plrb.org/documents/sewer-backup-coverage-vs-flood-exclusion/
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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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