Deciding occurrence when DIY repair causes loss years later

Coverage Q&A: The insured repaired power lines that were damaged when installing underground fiber-optic cables.

The insured was laying underground fiber-optic cables when they accidentally cut the claimant’s power line. (Photo: iStockphoto)

Every claim is different, and some insurance policies can be difficult to interpret for unique situations. FC&S Expert Coverage Interpretation, the recognized authority on insurance coverage interpretation and analysis for the P&C industry, makes it simple to find credible answers to your complicated coverage questions. Analysis brought to you by our FC&S experts. 

Editor’s Note: At times, the definition of occurrence determines whether there is coverage or not. This week’s coverage question deals with such a case.

Question: Our insured was laying underground fiber-optic cables in June 2018 and accidentally cut the claimant’s power lines, which caused a power loss along with resulting damages. No claim was filed then — our insured then repaired the lines themselves.

The policy with the insured ended in October 2019. In January 2020, the claimant loses power again from the alleged faulty repairs from 2018. The agent believes since this all occurred from one occurrence that we should cover both dates of loss. I believe, per the insuring agreement, the property damage must occur during the policy period, so we would cover the 2018 damages and not the 2020 damages since the damages in 2020 occurred outside the policy period. This is a CG 00 01 04 13 policy.

— New Jersey Subscriber

Analysis: Defining when an occurrence actually started, or whether the accident is a single occurrence or two, is not always easy to determine, especially when damages are separated by time and space. When there is a defined occurrence, certain policy exclusions may still preclude coverage, especially when an insured gets involved in completing their own repairs to prevent reporting a claim.

Answer: To learn the answer to this week’s coverage Q&A, please log into your FC&S Expert Coverage Interpretation account.

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