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October 8, 2015  

 
 Q&A of the Week
Raccoons in the Attic

An Ohio subscriber recently asked the following question:

I have a client that has sustained raccoon damage to his home, including the soffit area. This is a seasonal home and so the insured is often not there. The insured has on several occasions hired a pest removal company and has removed raccoons and attempted to board up their access points. There is some damage to the drywall in one of the ceiling areas and also the smell of animal urine. The insurance carrier has cited the exclusion that "we do not insured loss: Caused by: Nesting, infestation, or discharge or release of waste products or secretions, by any animal." They further cite a Merriman-Webster dictionary that says nesting as being "a place where an animal or insect lives and usually lays eggs or takes care of its young". They go on to say that nesting is when an animal makes your home their home. To make their home, they have an entrance and egress to their home which is considered part of the nesting process. Therefore, the damage to your home caused by the nesting raccoons is not a covered loss under your insurance policy.

Is the insurance company's interpretation correct or it there coverage? I have seen many articles and had many other insurers pay for damage by raccoons as they are not considered vermin, but have not previously seen the exclusion of nesting cited for raccoons. What are your thoughts?

ANSWER: ISO modified the exclusion for animals in the 2011 homeowners form. Instead of excluding just birds, vermin, rodents, and insects, as in the 2000 form, the form now excludes birds, rodents or insects, as well as nesting or infestation, or discharge or release or waste or secretions by any animals. This eliminates the need to define vermin or rodent, and clearly excludes raccoons, bats, squirrels, or any other animal that may move into the attic. Animal is a much broader category than birds, vermin, rodents and insects, and was used in order to eliminate the confusion and attempts to categorize different animals. The loss is not covered. 
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 What's New This Week in FC&S
The Dilemma of Residence Premises

One of the most standard things in a homeowners policy is the definition of residence premises. It is the foundation for the property being insured, and at first look seems straightforward. Read More
 
 Litigation Watch
Recovery for Innocent Third Party

The auto insurer brought an action against the insured, injured driver, and innocent third party seeking a declaration that the policy was void. This case is Citizens United Reciprocal Exchange v. Perez, 2015 WL 4877713.

Perez applied for an auto insurance policy with Citizens United. She chose a basic coverage policy with an optional $10,000 coverage limit for third party bodily injury liability. The insurer required the insured to list all household residents of driving age on the application, but Perez failed to do so. Machuca, the father of Perez's two children, was a resident of her household and if Perez had listed him on the application, the insurer would not have issued the policy due to Machuca's poor driving record.
Read More
 
 Fraud of the Week
Auto Damage – Washington
AMOUNT: $33,000.00


A Washington man filed a false police report claiming that he was driving and hit a freeway barrier. He submitted claims for more than $33,000 for damage to the auto and dental work. Read More
 
   
 FC&S Ask the Experts
Did you realize that the Q&A section of FC&S is made up of questions submitted by subscribers like you?

Paid subscribers to FC&S Online or print FC&S Bulletins are invited to submit insurance coverage questions to the editors. We'll provide a personalized opinion within five business days. (We'll let you know if it will be longer than that. Sometimes we have to gather research or other supporting materials).

Who knows? Your question may be featured (anonymously) in the online Q&A of the Week or as an FC&S update.

Submit your coverage interpretation question right to the editors of FC&S for quick and reliable information. Ask our expert staff a question by clicking here.
 
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Contact us at:
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The Zalma Insurance Claims Library
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The only source you'll need to successfully handle insurance claims from start to finish. More Info
Construction Defects Coverage Guide
Your single-source for identifying, insuring, investigating, prosecuting, and defending cases that result from construction defect claims. More Info
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FC&S Team
Kelly Maheu, J.D.
Publisher
  Diane W. Richardson, CPCU
Consulting Editor
Christine G. Barlow, CPCU
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  Diana B. Reitz, CPCU, AAI
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David D. Thamann, J.D., CPCU, ARM
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  Emily Brunner
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Barry Zalma, Esq., CFE
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  Donna Cozatchy
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