When Raccoons Make Your Home Their Home: Does the Vermin or Rodents Exclusion Apply? – Claims Magazine

Recently, a major insurance carrier placed an ad in a magazine that reported the plight of a woman whose home was invaded by a family of raccoons. The ad explained that the woman was alerted to the presence of the raccoons by the awful stench. Apparently, the raccoons had broken through the ceding and made themselves at home. She immediately called her insurance agent, who arranged to have the raccoons escorted out of her home via a platter of liverwurst and sardines. The woman's home was ultimately put back to normal, including new paint, new wallpaper and a new scent.

The ad prompted some thought as to how the insurer found coverage for this loss. The standard ISO Homeowners policy (HO 00 03 04 91) contains the following exclusion:

Coverage A – Dwelling and Coverage B – Other Structures

We insure against risk of direct loss to property described in Coverages A and B only if that loss is a physical loss to property. We do not insure, however, for loss… Caused by… Any of the following… (7) Birds, vermin, rodents, or insects

A raccoon is obviously not a bird or an insect, but is a raccoon a vermin or rodent? First, Webster's Third New International Dictionary 2544 (1993) defines the term "vermin" as follows:

1: animals obnoxious to man: as a: small animals (as lice, bedbugs, mice) that tend to occur in great numbers, are difficult to control, and are offensive as well as injurious b: birds and mammals (as owls and weasels) that prey upon game c: animals that at a particular time and place compete with man or his domestic animals (as for food).

The term "vermin" has been held to be ambiguous. In fact, of the limited number of cases that discuss "vermin" in an insurance context, no court has yet to find anything to be "vermin" for the purpose of applying an exclusionary provision. For example, in North British & Mercantile Ins Co. v. Mercer, 84 S.E.2d 570 (Ga. 1954), a personal property floater policy excluded 'loss or damage caused by moth, vermin and inherent vice." The term "vermin" was held not to apply to damage caused by a squirrel. See also Jones v. American Economy Ins. Co., 672 S.W2d 879 (Tex. App. 1984) (policy excluded loss caused by "vermin, termites, moths, or other insects"; court held that the exclusion was ambiguous and, therefore, the term "vermin" did not include a squirrel).

Likewise, in Sincoff v. Liberty Mut. Fire Ins. Co., 183 N.E.2d 899 (N.Y. App. 1962), the court decided that carpet beetles were not vermin in the context of an exclusion for "deterioration, moth, vermin and inherent vice.' The court stated that:

As indicated, experts well versed in entomology disagree as to the meaning of the word, and the dictionaries contain varying connotations, some indicating that vermin includes all bothersome insects, others limiting the term to parasitic insects. The term, therefore, obviously is capable of more than one meaning. This being so, the doubt in the exclusory clause must be resolved in favor of the insured.

183 N.E.2d at 901.

At least one court has held that a "vermin" exclusion does not apply to raccoons. In Umanoff v. Nationwide Mut. Fire Ins. Co., 442 N.Y.S.2d 892 (N.Y Civ. Ct. 1981), the court found that an exclusion for loss resulting from "birds, domestic animals, termites and other insects, or vermin" did not preclude coverage for damage by raccoons. After citing Sincoff and various dictionary definitions of "vermin," the court found the term ambiguous and capable of a definition which would not include raccoons. Further, the court observed that mentioning "domestic animals" in the exclusion implied that non-domestic animals such as raccoons were covered.

Consequently, it is unlikely that the raccoon damage to the house of the woman in the ad could be excluded as damage caused by "vermin."

Second, it is also unlikely that the raccoon damage could be excluded as damage caused by "rodents." The World Book Encyclopedia 397 (1996 ed.) lists the scientific classification of a "rodent" as part of "die order Rodentia in the class Marnmalia and the phylum Chordata." In addition, Collier's Encyclopedia 137 (1993) describes a rodent" as "any animal belonging to the Rodentia, an order of mammals composed of mice, rats, squirrels, porcupines, beavers, and other gnawing animals… . All are characterized by having the front teeth, or incisors, modified into a gnawing apparatus. These teeth are greatly enlarged…

A raccoon, however, is described by Collier's Encyclopedia 586 (1993) as "a small mammal with a pointed black-tipped nose, a black mask marking, and a bushy tail ringed alternately in buff and black. . The raccoon, Procyonlotor, is classified in the order Carnivora, family Procyconidae." A raccoon should not be considered a rodent, since raccoons are of the order Carnivora, and rodents are of the order Rodentia.

In short, it appears that the damage to the house of the woman in the ad is covered because there are no applicable exclusions. The standard Homeowners policy exclusion for "birds, vermin, rodent, or insects' was probably intended to apply to this type of loss; however, the courts have resisted labeling anything a "vermin" that would result in application of the exclusion, and a raccoon is not a rodent.

On the other hand, it is important to note that not all forms contain this same "bird, vermin, rodents, or insects" exclusion. For example, ISO's standard Commercial Property policy Causes of Loss – Special Form (CP 10 30 07 88) excludes damage caused by or resulting from "[i]nsects, birds, rodents or other animals." In fact, the predecessor to this standard Commercial Form contained an exclusion for "birds, vermin, rodents, insects or animals"; however, and ISO Explanatory Memorandum states that the terms "vermin" and "termites"were withdrawn from the exclusion since they were "redundant." As a result, if the woman in the ad had her commercial building damaged by raccoons, there would be no coverage because the damage would be excluded as damage caused by an "other animal."

The loss would also not be covered under ISO's standard Businessowners policy (BP 00 02 01 96). The Businessowners policy contains an exclusion for "[n]esting, infestation, or discharge or release of waste products or secretions, by insects, birds, rodents or other animals."

However, both the standard Commercial and standard Businessowners policies contains resulting loss provision that would provide coverage for any loss caused by the raccoons that resulted in either loss or damage by any "specified causes of loss" (i.e., a list of perils such as fire and explosion listed in the definition section of the policies) or building glass breakage.

In conclusion, the difference in the potentially applicable exclusionary language among the different ISO standard policies alone mandates that the language of the policy in effect at the time of the loss should be carefully scrutinized to determine if a loss caused by raccoons making you home their home is covered.