Loss Assessment for New Roof?

We have recently had a claim denied that has proven both disturbing and confusing, not only to us but to other agencies and insurers. Our insured has an HO 00 06 04 91. His condo association policy had ice damming claims in 1994 and 1996 that the association's insurer paid.

In 1998, the association hired an engineer, whose report indicated that a new roof was in order because of deterioration and construction defects. The association assessed members for the $18,000 that the roof cost.

Our insured's carrier, and others, denied the claim based on no covered loss, but other carriers paid all or some of the claim. We agree with our insured's carrier, but would like to know your opinion.

Pennsylvania Subscriber

Unfortunately for your insured, the denial is correct. Deterioration and structural defects are not covered causes of loss. The HO 00 06 loss assessment coverage responds to "direct loss to the property owned by all members collectively, caused by a Peril Insured Against under Coverage A…" The deterioration and construction defects are not perils insured against. Even if the insured has added endorsement HO 17 32 04 91 unit-owners coverage A, which gives open perils coverage, deterioration, inadequate design specifications, and construction are still not covered causes of loss.

 Possibly the carriers who are paying the claim are looking at the roof as being damaged by the ice, but in light of the engineer's report this would appear to be a stretch.

This premium content is locked for FC&S Coverage Interpretation Subscribers

Enjoy unlimited access to the trusted solution for successful interpretation and analyses of complex insurance policies.

  • Quality content from industry experts with over 60 years insurance experience, combined
  • Customizable alerts of changes in relevant policies and trends
  • Search and navigate Q&As to find answers to your specific questions
  • Filter by article, discussion, analysis and more to find the exact information you’re looking for
  • Continually updated to bring you the latest reports, trending topics, and coverage analysis