No-Fault Water Line Rupture and/or Sewer Backup

No-Fault Water Line Rupture and/or Sewer Backup

By Mike Wagner, Claims Manager

As most of our members are aware, some of the worst claims we deal with on a day-to-day basis are sewer back-up claims. They are much more difficult than a run of the mill property damage claim. The resulting mess can be very costly to cleanup and repair, and there are also health concerns when dealing with sewage. So, it is understandable that citizens become upset when sewage enters their property through no fault of their own. Making the situation even more challenging for our members is the fact that the Colorado Governmental Immunity Act provides significant protections when proper maintenance has been performed. Many of these claims end up being denied.

We understand that just because a claim is denied, the problems created by a sewer back-up do not necessarily go away for our members. Citizens complain to their community representatives or show up at city council/town board meetings to voice their displeasure. In response to this, CIRSA started offering an optional coverage at the beginning of 2018 to help respond to these claims when we have determined that our member is not legally responsible for the loss.

Aptly named, No-Fault Water Line Rupture and/or Sewer Back-up coverage; the goal of this program is to help affected homeowners by providing compensation for incurred expenses where liability has not been established against our member, and where coverage does not exist through the property owners own insurance policy. The specific policy language for this coverage is as follows:


For those “Members” who have selected this coverage, we will indemnify you for “property damage” including clean-up expenses that directly results from a water line rupture or sewer back-up that is:

  1. Involving water or sewer lines that are a part of the “Member’s” public water or sewer system; and
  2. Accidental and neither expected nor intended by the “Member” and/or property owner; and
  3. Instantaneous and demonstrable as having commenced at a specific time and date during the Coverage Period; and
  4. Not due to the negligence or other fault of the “Member” and/or property owner; and
  5. Not caused by rains or other acts of nature.

Up to the lessor of:

  1. The amount not covered by any other collectible insurance available to the property owner; or
  2. The sub-limit of coverage stated in the Declarations.

As mentioned, this is an optional coverage, that can be purchased with a member selected policy sub-limit. The three sub limits available are $2,500 per loss/$10,000 per year, $5,000/$20,000 or $10,000/$40,000. This coverage is not subject to a member deductible.

The sub-limit works in the following manner; For example, if the $2,500/$10,000 sub-limit is chosen, the policy will pay up to $2,500 per property owner for a loss that is not covered by the property owners own insurance carrier. If the property owner does not have any coverage available through their insurance carrier, the policy will pay their loss up to $2,500. If the property owner does have coverage, the policy will pay the property owners deductible and any resulting damages that are not covered by their homeowner policy up to a total maximum of $2,500. The total maximum available amount that can be incurred under this coverage during the policy year is $10,000. As mentioned, a member selected deductible does not apply to this coverage.

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