HO O4 95–LIMITED WATER BACK UP AND SUMP DISCHARGE OR OVERFLOW COVERAGE

(July 2020)

COVERAGE

For an additional premium, the HO 04 95 endorsement makes the limit listed in the endorsement schedule available for each eligible incident of direct loss to property covered in Section I of the basic policy. To qualify for coverage, the loss must be caused by any of the following:

· Water or waterborne material from within the covered dwelling backing up through either a sewer or a drain

· Water that overflows or escapes from a sump, sump pump or related equipment. The release of water (or material) may be due to the mechanical breakdown of the sump pump or due to power failure.

Example: Jeri Lazygyrl owns a home that is covered by a HO 00 03 policy. Her policy includes the HO 04 95 endorsement. Jeri’s basement has a sump pit. The sump pit holds a manual sump pump that, while quite old, is very efficient. One day, during a very heavy rain, water begins to back up into Jeri’s home. Jeri notices the water, but instead of turning on her sump pump, she goes upstairs and watches a rented movie. In this instance, since the loss was caused by Jeri’s lack of action (a working sump pump was not turned on), the loss is not covered.

This endorsement does not increase the policy’s applicable limits; rather it creates a maximum sublimit within the applicable policy’s coverage limit to apply to water damage.

SECTION I PERILS INSURED AGAINST

The mechanical breakdown, latent defect, etc., exclusion found in HO 00 03 and HO 00 05, HO 05 24, HO 17 31 and HO 17 32 is replaced by an exclusion that eliminates mechanical breakdown from this exclusion. This is necessary to facilitate coverage for loss caused by the mechanical breakdown of the sump pump.

EXCLUSION

This form has its own Section I – Water exclusion which, instead of stating that a basic form’s water exclusion does not apply, it:

· Adds its own exclusion that uses the same language as basic property forms, referring to activity caused by storm surge and the effect of waterborne material. However, it does not bar damage caused by water which backs up through sewers or drains or which overflows from a sump.

· States that the applicable basic form’s Power Failure exclusion does not apply (with regard to the coverage granted by this form).