A BC Supreme Court judge has rejected an insurance company’s claim that its optional overland flood insurance cannot cover for a water-damaged backyard.
In October 2018, plaintiff Bryony Shannon Osborne had purchased both home insurance and optional overland water insurance (dubbed “WaterCover”) from Family Insurance Solutions for her property on the Musqueam Indian Reserve No. 2. The optional overland insurance covers loss or damage caused by surface water that enters the insured premises as a result of a sudden accumulation of rain.
The policy also defined “surface water” as "water which accumulates upon or submerges usually dry land, resulting from torrential rainfall, rapid snow melt, spring runoff, or the rising of, breaking out or overflow of any freshwater lakes, rivers, or watercourse whether natural or manmade, excluding: waves and flood (as defined) or spray from any of these.”
On December 2018, heavy rain led to flooding in Osborne's backyard. But when she attempted to claim on her optional flood coverage, Family Insurance Solutions denied her. According to the insurer, it does not cover for water damage to lands, since its policy only refers to coverage for the policyholder’s dwelling and any attached structures it may have.
The case made it all the way to BC Supreme Court, with Family Insurance Solutions named as one of the defendants.
BC Supreme Court Justice H. William Veenstra rejected the insurer’s argument.
"In my view, the clear language of the Overland Water Coverage provisions indicates that coverage is available for loss or damage to the Premises from perils falling within the scope of that policy extension," Veenstra said in his judgment, which is posted on the BC Supreme Court’s website.
The judge also noted that “on a straightforward reading of the Overland Water Coverage provisions, coverage is extended to loss or damage to the Premises, including land.”
“In my view, the clear language of the Overland Water Coverage provisions indicates that coverage is available for loss or damage to the Premises from perils falling within the scope of that policy extension,” the judge added in his decision.
The Georgia Straight reported that Veenstra did not order the insurance company to pay Osborne's claim, instead asking the lawyers of both parties to “come up with the terms of an order that encompasses the interpretation that [he has] provided.”
