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Last Post 09/24/2010 1:19 PM by  ChuckDeaton
Septic tanks now outlawed in Malibu:
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Leland
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09/21/2010 8:37 PM

     

    News Flash: Septic tanks now outlawed in Malibu:

    http://latimesblogs.latimes.com/lan...alibu.html

    Let's say a home has a septic system like most Malibu homes in the hills.

    There is $50,000 of code upgrade coverage. New codes require "no septic" which means a sewer line must be dug. The house burns down and the septic system is damaged. (Malibu has big wildfires every few years). Coverage features 5% debris removal (additional coverage). Coverage on the dwelling is $100,000. HO3. (it would more likely be Dp1 or DP3, but let's say it is an HO3)

    Estimates for repair:

    rebuild house: $300,000.

    remove burned house: $20,000.00

    remove septic system from ground: $3000.00

    dump fees for all debris: $8000.00 (includes $2000 of extra costs due to city mandated recycling of construction debris - trash must be  sorted,        concrete goes to one dump, wood waste to another...)

    cost of new sewer line for portion on property: $20,000. (includes hillside engineering)

    cost to connect sewer line past property line, down a road to the city main: $17,000.00

    deductible $1000.00

    what would the SOL look like?

    (I know some of you Texans have done these Malibu claims before...)

     

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    ChuckDeaton
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    09/21/2010 10:34 PM

    Leland, there are sewer systems that are above ground and don't require attachment to a municipal sewer system. Systems such as this are common in South Louisiana.

    "Prattling on and on about being an ass with experience doesn't make someone experienced. It just makes you an ass." Rod Buvens, Pilot grunt
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    Leland
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    09/21/2010 10:50 PM
    i don't think Malibu or anywhere else in California would allow that. As you are aware, CA codes are much stricter than Louisiana.

    So the new sewer line is a code upgrade. Can we pay for the extension of the sewer line past the property line?

    Should the removal of the old septic system go under debris removal or code upgrade coverage?
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    Ray Hall
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    09/22/2010 10:03 AM

    If you had a house any place in the US and the sewer line had to be replaced, why would you dig up the old sewer line? ( IF insurance was not involved?)

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    ChuckDeaton
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    09/22/2010 10:32 AM
    Leland, while I am not intimately familiar with the coverage, a red flag that would catch my attention would be the fact that septic systems, piping and tanks are underground.

    My questions would revolve around whether or not the policy provides coverage for elements that are "underground".
    "Prattling on and on about being an ass with experience doesn't make someone experienced. It just makes you an ass." Rod Buvens, Pilot grunt
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    claims_ray
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    09/22/2010 10:48 AM
    Septic systems can be covered under the policy.

    I myself put in a claim and recovered due to a lightning strike to my aerobic septic system.

    I also wrote up damage to a septic system which was caused when a tree fell onto a tank collapsing part of the lid.
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    Leland
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    09/22/2010 10:53 AM
    Ray- there is no old sewer line to dig up. There is an old septic system to dig up, and code upgrades require it to be replaced with a sewer line.

    But we could rephrase your question: "Why dig up the old septic tank?

    That would be a good question. I think the city requires it. (remember the "code upgrade" coverage is actually "law & ordinance" coverage, so if the city requires removal of the old septic system it would be covered under the "law and ordinance", which is commonly referred to as "code upgrade")

    I think the city wants the old septic systems out for the same reason they are now illegal- due to the potential contamination.

    Chuck- good question. But the HO3 doesn't exclude stuff underground does it? If I remember previous discussions on septic tanks, most adjusters consider it part of the dwelling since it is connected to the building system.

    I'm curious to know if an HO3 would pay for the portion of the new sewer line that extends past the property line to connect to the city's sewer main.
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    claims_ray
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    09/22/2010 11:05 AM
    Catch 22 senario, ehh Leland?

    I would probably say that if the policy owner was responsible for the costs to connect the line out to the main then there is a good chance that the policy would kick in and pay. Now this would also depend on the limits of "law & ordinace" as we are also paying to remove the old system prior to running the new and we all know that this would not be cheap.
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    StormSupport
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    09/22/2010 1:05 PM

    There is $50,000 of code upgrade coverage. New codes require "no septic" which means a sewer line must be dug. The house burns down and the septic system is damaged. (Malibu has big wildfires every few years). Coverage features 5% debris removal (additional coverage). Coverage on the dwelling is $100,000. HO3. (it would more likely be Dp1 or DP3, but let's say it is an HO3)

     

    Why would the septic system be damaged if the house burned down? 

    Do the right thing, ALWAYS
    ~Meg~
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    Ray Hall
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    09/22/2010 1:59 PM

    I don,t think code up grade covers a major modification like a sanitary sewer systen on real estate. This is not the same, but Cal. has a lot of flood claims(river of mud) and all of the under ground is excluded in the NFIP flood policy.. An out lawed septic system has to be damaged by an insured peril, before debis removable is triggered. Also the section I exclusions exclusion  A,B. and C would apply. This is all on page 11 of HO 00 03 10 00

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    sbeau4014
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    09/22/2010 3:39 PM
    the septic system can very well be damaged by "wildfire" in that the firefighting equipment often drives over the top of it damaging lateral lines and/or the tank itself. That would all be related to the wildfire and be a covered peril under a homeowners policy.
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    Leland
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    09/22/2010 4:21 PM

    On claims I have handled in the past in Malibu and other areas the wildfire has damaged the septic systems. Sometimes they are made with plastic.

    But its true that if it isn't really damaged, the city shouldn't be making you upgrade it. But try to argue with a city.

    Some cities are known for seeing just a little bit of damage and saying that the "system" is "substantially" damaged so the whole thing needs to be replaced and the city won't allow repair.

    When the insured has no code upgrade coverage the insured's contractor will argue that the "system" (septic/plumbing/electrical etc.) was not "substantially" damaged and forcing a code up grade is not right.

    When the insured has code upgrade coverage the contractor might be more likely to agree with the city.

    One problem is that if the city say something must be upgraded (by law) it is not easy to disagree with them- they wrote and own the rule book.

    If the city says something is 1) damaged and 2) needs to be upgraded, how is the insurance company going to tell the insured that the city is wrong and deny coverage? Not easy to do.

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    claims_ray
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    09/22/2010 6:09 PM
    Maybe the code states that if substantial upgrades are made to a structure then the septic system must then be removed and the sewage system must now be tied into the sewer system.

    I could see that this may be the case as some might purchase an existing structure out in this area and attempt to keep an existing septic system in use instead of tie in to the sewer system when they almost tear down an existing structure and rebuild.
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    Goldust
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    09/22/2010 7:46 PM

      When the county utility installs a sewer system in a certain area of the county the people usually have a designated time to hook on at a reduced price. if the resident does not complete the hookup in an alotted time then they are penalized for not hooking up by the dead line. We have a suburb up here where people have rerouted their septic to a sewer main that is installed along the street. So actually all thats left of the septic system underground is the laterals. if I had to guess I would say first and foremost it is just like its always been it is the carrier's job to make the insured whole again. "FROM A COVERED PERIL!" If they are expecting to have the carrier pay for a line running clear to the nearest point of a new sewer line ,in my mind that would be betterment.

      That would be no different than not paying for caisons to be installed on a home on a hillside that didn't have them before!

    That is my 2 cents worth I could be wrong !

    JERRY TAYLOR
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    Leland
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    09/22/2010 7:59 PM
    code upgrade coverage is always paying for betterments - that's the point of the coverage.
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    Leland
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    09/22/2010 8:06 PM
    here's some examples of betterments that people can (and often do) get from their code upgrade coverage:

    single pane glass upgraded to dual pane

    GFI outlets where they didn't have them before

    ARC fault circuits on every bedroom

    underground feed of electrical

    sheer panel on walls (for seismic strength)

    bird stop at the openings on a clay tile roof

    weep screed on a stucco wall where none existed before

    bigger rafters after a fire

    I have seen all of these things get paid under code upgrade coverage.

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    Goldust
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    09/22/2010 9:08 PM

    Yes I am aware of that but not a sewer line that leaves the insured property.

    JERRY TAYLOR
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    Ray Hall
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    09/22/2010 9:56 PM

    Lets ask the coverage man ( I appoint Leland) how this loss should be worked. The insured says a tree is leaning over his house from a windstorm last night. He demands you send a tree remove it as the city inspector said his day care license will be pulled if.......................

    And don, t say call the examiner, he could have done this on the phone, and what does he /she want you to do... wring your hands is not the correct answer . Have you ever heard someone say ever bad thing that happens is not covered by insurance. It,s more like 16-18 named perils and 1/2 dozen real "risk of loss" sudden, unexpected and unentended and certainly an accident.

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    jdacree
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    09/22/2010 10:03 PM
    What little experience I have in this is predicated by the building permit required to get the work done. If the code upgrade on roofing for example has been increased to rooffing for 100 MPH winds, you will not get a permit inspection passed without that material. If you have O&L coverage the insurance pays for the item up to the limits of the coverage.
    If the jurisdiction in which the coverage is written has a mandate that plumbing repairs force the elimination of septic systems then that has to be done. The policy is to return the property to what it was before the event. The property had indoor plumbing before, and it wil again, but now tied into the city line. O&L coverage is a rider that the insured takes out to guarentee that to repair the damage due to a covered event,that the property can be properly repaired at no other cost to them than the deductible. The carrier is supplying this at extra charge, if there is no event then they are making extra money on every policy written, if they have to pay they aar out the money. Just a crap shot for the carrier.
    Jim Acree Stupidity is the art of not trying to learn Ignorance is the lack of opportunity to learn I am ignorant
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    jdacree
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    09/22/2010 10:12 PM
    In Ray's case above you have 2 situtations;

    1. the city says this has to come down to keep the day care license. This tree will have to go.
    2. The carrier is going to say that ;
    a. the tree is not covered due to event bing wind, not fire or lightning and
    b. the tree is not touching the structure

    The property owner is out the cost of getting this tree down and disposed of.
    Jim Acree Stupidity is the art of not trying to learn Ignorance is the lack of opportunity to learn I am ignorant
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