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Fracking is the process of forcing water, chemicals and sand deep into underground shale formations to release natural gas. Fracking has recently become controversial because some allege it causes earthquakes sinkholes, or seepage, and water contamination.Most articles on fracking discuss insurance coverage issues from the standpoint of liability insurance, i.e., potential liability coverage for the gas company performing fracking. Rather than discuss liability insurance, this post examines potential property insurance coverage for homeowners affected by fracking activities and the possibility that homeowners may be denied insurance coverage for property losses caused by fracking.
Common homeowners insurance policies cover the home and other structures against direct physical loss or damage to property covered during the policy period, except as excluded or limited. Examples of “Losses Not Covered” or excluded under common homeowners policies include numerous events which have been alleged or, in some cases, linked to fracking, such as: contamination of land or water serving the residence premises; settling, cracking, shrinking, bulging or expansion of pavements, patios, foundation, walls, floors, roofs or ceilings … This common policy exclusion raises serious problems for most homeowners near fracking sites, given the EPA’s link between fracking and groundwater contamination.
Likewise, given the allegations of a connection between fracking and earthquakes, homeowners may experience serious exposure since most policies exclude, … Losses resulting from water or any other substance on or below the surface of the ground, regardless of the source. This includes water or any other substance which exerts pressure on, or flows, seeps or leaks through any party of the residence premises.
… Water under the ground surface pressing on, or flowing or seeping through:
Foundations, walls, floors or paved surfaces
Losses resulting from earth movement of any type, including earthquake, landslide, subsidence, pressure, sinkhole, expanding bulging cracking or settling of the earth, whether or not the earth movement is combined with water. Most common homeowners policies also exclude losses or damage caused by “any collapse,” except for collapse caused by or resulting from certain perils not relevant to this post.
These earth movement policy exclusions are extremely concerning for residents of Youngstown, Ohio, where homeowners have experience eleven earthquakes in 2011, one of which emanated from within half mile of a 9,000-foot-deep fracking well. According to The Daily Beast, “all of the earthquakes emanated from within five miles of local drilling sites.”
Given the common policy exclusions above, homeowners who experience property losses related to or resulting from fracking may be denied coverage under their policies. Losses resulting from water under the ground surface pressing on, or flowing or seeping through foundations or walls are excluded from coverage. Earth movement and collapse are often excluded perils, and where the loss resulted from perils that are excluded from coverage, coverage is often denied.
Homeowners near current or potential fracking sites should consider their own exposure, and raise insurance coverage concerns with local, state and county officials making decisions on fracking locations and permits.
Hillis Adjustment Agency, Inc.
2336 Street Road
Bensalem, PA 19020
Hillis Hotline (24 hours a day, 7 days a week):
Local Telephone Numbers:
215-245-5600 (Philadelphia & Surrounding Suburbs)
610-642-5700 (SE Pennsylvania)
570-839-6700 (NE Pennsylvania / Scranton)
609-399-7700 (New Jersey)
E Fax: 866-808-6697
When disaster strikes…Purchasing comprehensive property insurance coverage is the appropriate precaution for events - such as fire. flood, theft, smoke or windstorm - that can significantly disrupt your life and work. This coverage is designed to protect you and your assets, as well as ensuring your complete recovery. But when disaster occurs, you should not have to worry about whether you will receive an adequate settlement for your loss, to which you are entitled.
You deserve an advocate in your time of need.As the insured, you are responsible for preparing your property loss claim. Doing so without the help of a Public Adjuster is like representing yourself in court without an attorney. Your insurance company has trained professionals to represent their interests, and the interests of their shareholders. Your carrier’s adjuster might suggest cost saving measures to reduce the value of your loss, minimizing the carrier’s exposure or liability, often leaving you to pay out of pocket for repairs actually covered under your policy!
A Hillis Public Adjuster is your professional property loss consultant. We work for you, the policy holder… not the insurance company. Your insurance company’s main objective is to collect premiums and minimize costs and payouts. Our goal is to represent your interests, investigate and identify all underlying damage, and give our clients the best advice, to attain the maximum insurance recovery possible, and as quickly as possible.
Rely on Hillis
Tens of thousands of commercial and residential property owners have come to rely on Hillis. Hillis Public Adjusters are specialists in the overwhelming task of thoroughly documenting and preparing your insurance claim. Utilizing Hillis, your recovery will be substantially aided. We are uniquely qualified to estimate, adjust and negotiate your claim and present evidence to support it. Our team understands the intricacies of reconstruction, plumbing, electrical and landscaping costs and issues, as well as interpreting your insurance policy and your coverage to your best advantage.