When does a power outage trigger insurance coverage?
There may be insurance coverage for property damage due to a power outage caused by a covered peril.
The tumultuous late spring weather that rocked swathes of the U.S. recently brought with it power outages that impacted millions of insureds nationwide.
It has taken several days, for instance, for crews to restore power after “drenching storms” and massive hail downed trees and power lines across North Texas — a region that can see dozens of tornadoes a year, according to the National Weather Service.
In the wake of such dramatic weather events, insureds have questions about how much damage and restoration cost is covered by their insurance.
Property damage caused by a power outage may be deemed a covered loss, according to Travelers. Here are some common scenarios the carrier addresses in an article about homeowners coverage and power outages:
- If a power outage causes food to spoil, coverage is not automatic. The policyholder would need photographic evidence that the property damage was the direct result of a covered loss, such as a natural catastrophe or damage to an off-premises power plant. The same is true of appliances that sustain damage due to a power outage.
- There may be limited coverage for any medications requiring refrigeration that spoil due to a power outage.
- When loss of power renders a home unlivable, there may be coverage provided for accommodations as long as the power outage was caused by a covered loss event. (This scenario is different for businesses that keep refrigerated food on site. In this instance, businesses are well protected when they have added a spoilage endorsement to their business insurance, according to Policygenius.)
- When the weather is dangerous enough for local emergency personnel to prohibit access to an insured home, there may be coverage for living expenses, but storming will need to have been dangerous enough to cause widespread damage.
“Every claim is different and may impact the availability of coverage,” Travelers notes.
Kin Insurance says that insurance coverage for power outages will depend on the exact terms of a given policy along with the circumstances surrounding the outage.
“In most cases, coverage for a power outage is based on cause and location,” the carrier notes. “If the power outage is caused by a covered peril, like a fallen tree or lightning strike, and that peril happens on your property, then your damage may be covered.”
Allstate advises insureds that while there may be coverage for damage or lost property as the result of a power outage, policy limits will apply and there also may be a deductible to pay in order to trigger applicable coverages.
“It’s never fun to experience an extended power outage,” Allstate says, “but by understanding your [insurance], you may be better prepared to recover from one.”
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