What is “Acts of God” Insurance?

These trees are not your friends…if they fall and cause damage.

For this post, we’ll start with a trivia question:

Which of these circumstances would be covered by insurance as an “act of God”? (Read to the end to find your answer!)

  1. Lighting striking and burning down multiple houses
  2. Fire set by an arsonist

Sometimes as much as you can try to prepare for the unpreparable, natural disasters– so-called “acts of God”– strike us unawares and unprepared. Fire, lightning, floods, and earthquakes– all might strike at a moments notice, and leave us with a crushed roof or burned down home. A Louisiana court (a state faced with its fair share of natural disasters) gave this definition of an act of God:

“An act of God is an unusual, extraordinary, sudden, and unexpected, manifestation of the forces of nature which man cannot resist. An injury caused by an act of God is an injury due directly and exclusively to natural causes which could not have been prevented by the exercise of reasonable care and foresight.”

If you look to an insurance policy, you are not likely find the phrase “act of God”, or even natural disasters. Instead, such incidents are usually categorized as “perils”. Whatever the name, the trick is to have a clear understanding of what your insurance company considers a peril, before it becomes a real issue.

Take, for example, a tree blown over in a freak storm into the neighbor’s yard (as happened this winter in areas of our usually temperate California). One would think this was a no-brainer act of God. However, what if the tree was prone to blowing over, in the case of strong wind, due to a lack of maintenance or some condition which could have been discovered? If so, whose insurance will cover the cost of repairs to the yard? Yours or the neighbors? Or will it be covered at all? You can see how it can become a complicated grey area. It is generally agreed that an incident is an act of God if no human can be named culpable in any way.

With this said, we reveal the answer to our trivia question! A fire caused by lighting which burned multiple houses down is considered an act of God, while the fire caused by an arsonist would not be covered as an act of God (despite most likely being out of the homeowners hands).

Questions about your policy and acts of God coverage? Call BMR Insurance at 714-838-1911 for more information — whether or not you are currently a client, we’re happy to help!

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