Collapse Coverage for Damage to Machinery?

Q

We write a farm machinery floater for a farmer who rents the premises he is farming. The building in which his machinery is stored collapsed onto the machinery.

We agree that we owe to repair the machinery. However, there will be a large expense to move the pieces of the building off the machinery. Since we do not insure the building, we don't believe we owe for this part of the claim.

The agent disagrees and wants us to pick up that expense, as well. What is your opinion?

Ohio Subscriber

A

Even though your company does not insure the building in which the farm machinery is stored, you are not relieved of the responsibility of paying to move the pieces of the collapsed building so that the damaged machinery can be taken to the repair shop. This should not be mistaken for debris removal; rather, it is all part of the cost to repair the damage to the machinery.

By way of an analogy, think of an insured with an HO 00 04. The house he or she is renting burns. In order to get his smoke damaged furniture out and to the restoration company, some of the damaged house must be moved. That is part of the cost to repair the insured's damage.

Your company's responsibility is not “debris removal”; it is the repair of the damaged property; and whatever is necessary to make those repairs.

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