Please advise where we can find coverage.

Mississippi Subscriber

A

The ISO homeowners policy HO 00 03 04 91 covers water damage to the home. Under the section I exclusions water damage is defined as “flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind.” Most courts have maintained, however, that “surface water” is something naturally occurring, as from a severe rainstorm. “Artificial” surface water, as from the tank, does not fall under this definition, and is therefore covered.

Coverage for contents under the HO 00 03 is on a named perils basis. If the tank were to fall and hit the home, “falling objects” is a covered peril. But if the tank fell or ruptured off the insured premises, there is no coverage. Damage to contents caused by accidental discharge or overflow occurring off the residence premises is excluded.

ISO's HO 00 15 04 91 offers a solution. Under the section I exclusions, the following paragraph is added to 1.c: “Water damage to property described in coverage C on a premises or location owned, rented, occupied or controlled by an 'insured' is excluded even if weather conditions contribute in any way to produce the loss.” This paragraph, however, appears under the section I exclusions which define “water damage” as, among other things, “surface water.” Since the courts generally maintain “surface water” is something naturally occurring, there is coverage.

We checked with a county risk manager to see if local government might provide coverage. He said that unless negligence could be proved, there would be no coverage for loss to homes surrounding a water tank. A homeowner could present a bill to the local government for damages, but payment might be on a case-by-case determination.