Protection litigation is usually a recreation of decoding the language of an advanced doc, the insurance coverage coverage. Doing so just isn’t at all times simple, and issues aren’t at all times as they appear. This put up is a reminder to check When Phrases Collide: Coverage Interpretation Doctrines and the ten Commandments. Perceive your Insurance coverage Coverage Higher—RTFP!
A current Washington ruling highlights the significance of learning the coverage intimately to search out vital pathways to success, even the place the case might look doomed. 1 Craig Spurlock lived in Washington state and had a State Farm owners coverage. In a storm, rainwater gathered within the crawlspace underneath the home because of a sump pump backup. As defined beneath, underneath the coverage phrases, if the sump pump was situated “inside the inside” of the “dwelling,” then the loss was coated. The sump pump was bodily situated within the crawl area underneath the home. Looks as if it’s excluded, proper? That’s what State Farm argued when denying the declare. It was mistaken.
Mr. Spurlock’s coverage included a Again-up of Sewer Drain (BUSD) endorsement, which coated water back-ups solely if the water comes from “a sump pump . . . situated inside the inside of the dwelling …” (emphasis added). The coverage then outlined the time period “dwelling,” which contained two comparable however separate key phrases, “construction” and “constructing construction.” Particularly, the Coverage outlined “dwelling” as “the constructing construction” in addition to “constructions hooked up to the dwelling.” The court docket then regarded for the definitions of the 2 phrases “construction” and “constructing construction.” Because the phrases are completely different and located in the identical clauses, the court docket discovered that they shouldn’t be interpreted as being the identical factor. The Coverage particularly outlined “constructing construction” as “a construction absolutely enclosed with everlasting partitions and a roof” that features “the muse supporting the construction, together with…crawl area partitions.” For the undefined time period “construction,” the court docket adopted the widespread maxim of turning to dictionary definitions. It famous that Webster’s outlined “construction” as “one thing constructed or constructed.”
The vital query was whether or not the sump pump was itself hooked up to the muse partitions underneath the crawl area or situated inside a “construction” that was itself hooked up to the muse partitions. Right here, it was undisputed that the sump pump was situated inside a “buck-out,” a small construction that housed it and held it in place. Additional, the “buck-out” was undisputedly bodily hooked up to the muse partitions within the crawlspace. Making use of these info to the coverage, the court docket held that the buck-out was clearly itself a “construction” and that “construction” was itself “hooked up” to the muse partitions within the crawl area, which constitutes a “constructing construction” and, due to this fact, a “dwelling.” Thus, the sump pump, situated beneath the home within the crawl area, was sufficiently situated on the “inside of the dwelling” to assist protection.
As this case exhibits, by no means hand over with out a thorough coverage assessment simply because a denial primarily based on an advanced coverage sounds proper. It could very properly find yourself being mistaken.
A associated weblog for these is What’s Coated Beneath Buildings Away from the Residence Premises, written by my Chicago Merlin Legislation Group colleague Christina Phillips.
Thought For The Day
“Our best weak spot lies in giving up. Essentially the most sure method to succeed is at all times to strive only one extra time.”
—Thomas Edison
1 Spurlock v. State Farm Fireplace & Cas. Co., 2:23-cv-00467 (W.D. Wash. Dec. 26, 2024).