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Our insured suffered a fire loss to an apartment building that has a retaining wall attached to it. The fire did not damage the retaining wall in any way. The wall was deteriorated and leaning over prior to the fire and does not have to be removed or replaced in order to affect repairs to the building. Forms involved are the CP 10 30 with an ordinance and law endorsement attached.

During a building inspection, the building inspector noticed the leaning, deteriorated retaining wall and stated that he would not give a certificate of occupancy permit until the wall was removed and replaced. There may be an ordinance or law that requires the deteriorated retaining wall to be removed and replaced. Is there any coverage for this under the ordinance and law coverages? Generally, I thought that there had to be some type of causal connection between the fire loss and the damage it did and the ordinance and law in question. It appears that the reason why this is an issue is because the deteriorated retaining wall was discovered during a building inspection. There does not appear to be any connection between the fire damage to the structure and the retaining wall. The retaining wall is covered under the building—added as covered property.

Please let me know if you see any coverage for this type of loss.

Connecticut Subscriber

There would be no coverage for removing and replacing the wall since it was not damaged by a covered cause of loss and does not affect repairs of the covered loss. Ordinance or law coverage typically states that the property must sustain direct physical damage and that at least part of the damage must be covered. The CP 04 05 states, "But if the building sustains direct physical damage that is not covered under this policy, and such damage is the subject of the ordinance or law, then there is no coverage under this endorsement even if the building has also sustained covered direct physical damage." So, while the building did sustain covered fire damage, the part of the damaged building that is subject to the ordinance is the deteriorated wall, which did not sustain covered damage. So, the ordinance or law coverage would not apply.

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