ANIMAL-RELATED PROPERTY DAMAGE

(May 2023)

Guidelines about how loss caused by animals is covered under automobile and homeowners policies are always useful. The expense is usually considerable when an automobile and a deer collide. It’s common to hear about such losses. Less is known about occurrences such as the invasion of a home by an adventurous deer or other wildlife. While less common, the financial consequences can be very costly.

A variety of other animals that live in close proximity to us commonly cause significant damage when they target our living spaces, such as the following:

Groundhogs
Possum
Raccoons
Skunks
Squirrels

Groundhogs are problematic because their digging can damage yards, home foundations and create trip/injury hazards because of the volume of dirt they are capable of displacing. Other animals’ damage usually result from their nesting in homes, chewing through parts of a home, including wiring, insulation and supports and leaving their wastes.

Exposure to more animals can be minimized. Generally, they are attracted to homes offering easy access to food (bird feeders, outside pet food) or garbage in poorly secured containers.

An insurance agent can expect a call as soon as an insured is aware of the scope of damage after such an occurrence. Familiarity with the coverage applicable to losses involving animals can increase an agent’s ability to answer an insured's "Am I covered?" inquiry. Damage caused by critters of other types may not be covered.

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Coverage Under an Automobile Policy

Under automobile insurance, loss caused by contact with a bird or animal is covered. Depending on the form used by the insurer, protection against such losses will be in either the collision or other than collision areas of the given policy’s physical damage section. The scope of coverage is the same.

Vehicles versus deer, cows, birds and other animals are routinely handled by insurance company claims departments as a form of “other than collision” loss.

Example: Hailey was enjoying her brand-new convertible. She loved the feel of the wind as she crossed the city’s tallest suspension bridge. Suddenly, she caught sight of an object crossing in front of her; then a large “thump” as her windshield splintered. She pulled off to the bridge’s breakdown lane since she could no longer see. She also discovered it was a seagull that had demolished her windshield.

Claims are subject, of course, to the applicable deductible. Nevertheless, recovery can be substantial, as anyone will attest whose car has been hit by a leaping deer.

Coverage Under A Homeowner Policy

Regarding animal damage under a homeowners policy, let’s use ISO Homeowners 3, a widely written residential insurance form. It provides such coverage under its dwelling and other structures sections, subject to specific exclusions.

The policy has exclusions for damage caused by birds, rodents, insects and animals owned or kept by an insured. A policyholder (and company personnel) must rely on dictionary definitions when words and terms are not defined in policies.

Birds are warm-blooded, winged, feather-covered vertebrate. Rodents are animals that belong to the order of Rodentia. They are mammals that gnaw or nibble, including mice, squirrels, porcupines and beavers. Some policy forms include wording that opens the exclusion to also apply to other, similar animals, such as armadillos.

An exclusion for direct damage to property within the scope of dwelling coverage, caused by "animals owned or kept by an insured," would apply to either domestic or non-domestic animals owned or kept by an insured. In other words, damage caused by a dog owned by an insured or one kept by an insured would not be covered.

Example: Mary Karnivore has known her neighbors and their dog, Smoky, for years. When their regular dog-sitter becomes sick, Mary happily agrees to keep Smoky during their vacation. The first two days with Smoky pass without incident. Unfortunately, the rest of the week is filled with episodes of the dog destroying bedding, table and chair legs. When Mary documents the damage and sends a claim into her insurer, the company tells her it’s not covered. The damage was done by an animal in her custody.

However, if a deer or other animal not owned or kept by an insured damages property included under dwelling coverage, the policy applies.

Example: One day, the Garderlies were all transfixed by a deer browsing in their front yard. The deer was startled by the opening of their neighbor’s garage door. . It crashed through the Garderlies’ bay window, thrashed around their living room and then jumped back out and ran off. The damage to the living room’s furniture, carpeting, window and wall is covered.

Personal property coverage (Coverage C under HO 3 - Special Form) is provided on a named peril basis. There is no named peril for damage caused by animals. So, while the dwelling itself is covered as the animal makes its way into the home, the personal property that is destroyed as the animal panics and attempts to find an exit is not covered. However, the part of the dwelling that is destroyed as the animal exits is also covered.

The personal property can be covered for such animal damage, however, in one of two ways:

HO 5 – Comprehensive Form can be purchased that provides the same causes of loss for both dwelling and personal property.
A scheduled property endorsement or personal articles floater can be attached so that the more comprehensive causes of loss apply to the scheduled property.

Another consideration is how certain types of losses are treated. Not all activity may qualify for coverage because of how an insurer may characterize a given event. For instance, while direct damage may be covered, that may not be the case for damage from animal odor or damage that is wholly attributed to attempts to extricate an intruder.

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Coverage Under an Umbrella Policy

Increasingly, umbrellas are written on a following form basis. Under this condition, excess coverage would be available for any home or auto loss that would be eligible on the primary (underlying) policies that are listed on the umbrella policy.