It is our belief that the lift station is not covered property, as it is excluded as "machinery and equipment in the open"—unless specifically scheduled, which it is not. Therefore, any repairs to the lift station equipment are not covered. The agent does not concur.

Also in question is the cost of mitigating the wastewater being sent from the buildings from backing up into the buildings (by way of pumping the tank) to prevent property damage and business income loss.

As the lift station can also be described as a sump pit, our interpretation is that the water exclusion language in the CP 10 30 and CP 10 32 would apply: "Water that backs up or overflows from a sewer, drain or sump."

This would exclude damages as a result of the wastewater backing up into the buildings due to the lightning damaged sump, and therefore any costs to mitigate would not be covered, per the anti-concurrent causation language in paragraph B.1. of the CP 10 30 (if the lift station was covered property).

Colorado Subscriber

We agree that the equipment you describe would be property not covered, as per the additional property not covered policy language you sent us. So, the loss would not be covered, nor would the cost to mitigate the loss. The CP 00 10 states that expenses necessary to protect covered property from further damages will be reimbursed, but since this loss is not dealing with covered property, those expenses would not be covered.

The CP 00 30 requires a covered cause of loss to occur but the covered loss must be to just property—covered property is not specifically mentioned. Here, an argument could be made for extra expense coverage for emptying the tank because a covered cause of loss was the cause for the station needing to be emptied—lightning struck the panel and shut down the pump. The water exclusion would not come into play because there was no water damage—the emptying of the tank prevented this. The damage that was caused was due to the lightning strike (from what you describe), and if the extra expense involved in having the tank emptied avoided or minimized a suspension of business and fixing the pump reduced the amount of business income loss, then extra expense coverage could apply.