Chip Merlin | Property Insurance Coverage Law Blog | July 14, 2017
Judges often make erroneous decisions based on the information presented and argued to them by the attorneys selected by the parties. I was thinking about this while writing my post, Experts Regarding Causation Can Be More Important Than Witnesses — or, Don’t Believe Your Lying Eyes When Your Insurance Company Hires an Expert.
The policyholder in King v. American Family Insurance1 was represented by a legal aid society—not attorneys specializing in property insurance law. Had the policyholder’s attorneys done some simple research and subscribed to the FC&S reference materials, they could have cited this bulletin:
EARTH MOVEMENT EXCLUSION AND PILE DRIVING
Pile driving nearby causes damage to insured’s building. Insurer denies coverage due to earth movement exclusion. Is this a covered loss?
July 24, 2008
Q
The insured’s building is situated close to a highway on which some heavy reconstruction work is in process. The pile driving that is going on is sending tremors through the earth and the insured worries that his building may be damaged as a result. Will coverage for any damage be adversely affected by the earth movement exclusion contained in the form?Illinois Subscriber
A
No, it will not. The earth movement exclusion relates to earth tremors caused by natural forces. The earth movement that might be brought on by an explosion as well as by the action of the pile drivers is a horse of a different color. The examples of “earth movement” listed in the exclusion (earthquake, landslide, mine subsidence, or earth sinking, rising, or shifting and volcanic eruption or explosion) provide all the support that is necessary for the notion that natural causes are the subject of the exclusion.
(Emphasis added)
Larry Bache wrote on this topic in, Are Damages Caused by Blasting or Other Man-Made Earth Movement Covered Under Your Insurance Policy? Indeed, I previously wrote How Adjuster Reference Materials Can Help Change the Law. There, I noted that the Insurance Service Office published a pamphlet instructing first party property insurers how to subrogate against construction companies after those insurers pay for the cracking caused by such construction activities
There is even a website, http://vibrationdamage.com/index.htm, devoted to the issue and instructs people how to make an insurance claim. The website correctly indicates that some insurance companies sell cheap insurance and changed the standard language to include exclusions for man-made earth movement. Don’t buy insurance based on price!
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1 King v. Am. Family Ins., 2017-Ohio-5514, 2017 WL 2735614 (Ohio App. June 26, 2017).