Water Damage Exclusions

1) Policy exclusions – water damage
a) Flood, Surface Water, Waves
b) Water Below the Surface of the
Ground
2) Reasons for Water Damage Exclusions
a) Loss Frequency
b) Loss Severity
3) Other Sources of Water Damage
a) Accidental discharges from
plumbing systems
b) Fire suppression efforts
c) Water escaping from hot water
heating systems
d) Weather conditions
i.
rain
ii.
Melting snow
iii.
Ice dam
4) Common Water Loss Scenario examined
a) Source of water: tub overflow
b) Relevant policy provision:
accidental discharge peril
5) Changes in policy language
a) 1991 edition of ISO HO 00 03
b) 2000 edition of ISO HO 00 03
6) Definition: Water Damage
a) Surface water
b) Flood
c) Water below the surface of the
ground
7) Introduction to components of exclusion
a) Anti-concurrent causation
preface
b) Text of Exclusion
c) Trailing language

1) Components of the exclusion
a) flood
b) surface water
c) waves
d) tidal water
e) overflow of a body of water
f) spray from any of these,
whether or not driven by wind
2) Additional tools
a) definitions
b) judicial interpretations
c) loss scenarios
3) Differences in policy editions
a) 1991 edition of ISO HO 00
03
b) 2000 edition of ISO HO 00
03
4) Flood
a) definitions
b) sources of flood water
c) judicial interpretation
d) loss scenarios
i.
dam
ii.
storm surge
5) Surface Water
a) sources
b) natural source rule
introduced
c) trailing language to exclusion
introduced
d) loss scenarios
i.
water in a window well
ii.
water on a patio
iii.
water in a stairwell
6) Waves and Tidal Water
a) definition
b) judicial interpretation
c) tsunami
7) Overflow of a Body of Water
a) Legal concept: ejusdem
generis
b) Interpretation
8) Spray from any of these
a) definition
b) coverage interpretation

1) Policy language
a) 1991 ISO HO 00 03
b) 2000 ISO HO 00 03
2) Broad preface to exclusion
a) 1991 ISO HO 00 03
b) 2000 ISO HO 00 03
3) Water-borne material policy revision
a) policy wording
b) interpretation
i.
clean water
ii.
black water
iii.
gray water
c) loss scenario
d) judicial interpretations
4) Trailing language addition
a) policy language
b) effect on natural source
limitation
5) Water Below the surface of the ground
a) definition
b) judicial interpretation
c) loss scenarios

1) Exception: Water described in the mold exclusion
a) policy language
i.
limitation: hidden requirement
ii.
limitation: water covered requirement
b) loss scenario
2) Exception: Wear and Tear
a) policy language
i.
off-premises sources of water
ii.
on-premises sources of water
b) loss scenarios
3) Exception: Accidental Discharge Peril
a) policy language
i.
limitation: applies to contents only
ii.
section I exclusions apply
b) loss scenarios

1) Anti-Concurrent Causation Preface
a) policy language
b) purpose of preface
c) enforcement
i.
majority view
ii.
minority view
d) proximate cause analysis
e) loss scenario
2) 2000 policy edition revision: Human or animal forces or any
act of nature
3) Natural Source Rule
a) policy language
b) court cases
i.
Hatley v. Truck Ins. Exchange
ii.
Cantanucci v. Reliance Ins. Co.
iii.
Buttelworth v. Westfield Ins. Co.
iv.
Kozlowski v. Penn Mut. Ins. Co.
v.
Gatti v. Hanover Ins. Co.
vi.
Josephson v. American Family Ins. Co.
c) loss scenario