Intent of 5 Percent Debris Extension?

There is a 5 percent extension for debris removal of covered property under the HO-3 forms. Stated coverage under the dwelling, other structures, and contents have been exhausted. A contractor charges an insured a lump sum for removing covered debris, which exceeds the total remaining 5 percent coverage available. He refuses to provide a break down because he says he cannot separate the cost to remove the contents from the cost to remove the dwelling debris. I am required to do so on the premise that each 5 percent limit is a separate limit, and the cost to remove contents should only be a few hundred dollars and not exceed the 5 percent limit, while the dwelling debris will greatly exceed the limit. What was the intent of the coverage? Is it an aggregate limit to be applied to debris removal since it is impossible to separate the covered debris? 

Pennsylvania Subscriber

The debris removal provides an extra 5 percent of the limit that applies to covered property if the actual damage and removal exceeds the limit. While the dwelling coverage and personal property coverage are stated separately on the declarations page, if the insured suffers a total fire, how is someone supposed to be able to separate burned contents such as bookcases from burned walls? Ash is ash, and while the sinks and bed frame may be recognizable, most other items won't be.

The intent of the coverage is to provide coverage for debris removal for large losses. As with any insurance policy, when the language is ambiguous, the insured gets the benefit of the doubt. If you have a situation where the contents damage and its debris removal fit within the contents limit, and the dwelling damage and debris removal are well over the stated limit plus and extra 5 percent, then pay the contents and their removal under C, and the dwelling and its debris removal under A and the additional debris removal coverage.

 

 

 

 

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