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Exclusion vs. Named Peril

Summary: Standard homeowners forms, like most property forms in current use, exclude all loss “caused directly or indirectly by any of the following . . . water which backs up through sewers or drains or which overflows from a sump.” The 2000 HO 00 03 10 00 expands to include “water-borne material which backs up through sewers and drains.” It also adds “which overflows or is discharged.” And, “a sump pump or related equipment” now accompanies a sump. The policy language leading to this exclusion, “such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss,” attempts to circumvent the doctrine of concurrent causation (for more information on this topic please seeConcurrent Causation ). However, in courts where sewage has been distinguished from water, the language appears to have been ignored. This article deals with different court interpretations of the exclusion. Though some of the cases cited are over twenty years old, all have been verified as good case law.

Topics covered:Water damage coveredCoverage excludedWater distinguished from sewageCoverage for back up of sewers and drains

Water Damage Covered

The language of the sewer or drain back up exclusion has led to a number of difficulties. Sandwiched between exclusions of loss by flood and tidal waves and loss by seepage of subsurface water through floors and walls, is it—like these other exclusions—intended to deal only with water that comes from the exterior? Or, should the exclusion be applied to water that originates in the interior through the structure’s plumbing system? Is it valid to distinguish between water that flows backward through the drainage system (as when a sudden downpour causes a greater accumulation of surface water than the drainage system is capable of handling) and water that never gets into the drainage system because pipes or drains within the house are blocked and full?

Some court decisions have acknowledged no such distinction, applying the exclusion to both types of loss. A few courts have found some basis for limiting the exclusion’s scope in an attempt to resolve the apparent conflict between the exclusion itself and the homeowners named peril of accidental discharge from within a plumbing system.

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