At first glance you might assume that a fallen tree is covered by homeowner’s insurance. In most situations this is true but the answer is that it depends.
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Check your policy with your agent or your carrier if you want to know if your situation is covered. I’m going to answer this question based on a standard HO-3 or HO-5 policy. These are what most companies use and even if they vary from these, the variations usually increase coverage. If you have a different home policy the answer may be more complex. You should definitely check so that you know before you have a claim.
If my tree falls on my house or car…
When your own tree falls on your own property your own policy will cover you subject to your deductible. It is common to have a $1000 deductible, however here along the Front Range of Colorado we are seeing more and more carriers with a separate Wind/Hail deductible. In these cases, there may be a $2500, $5000, or maybe a percentage deductible like 1% or 2%. When a carrier covers a loss they will take the total amount of the claim, subtract your deductible, and write you a check for the difference.[1] If you have a mortgage and the check is over $2500, they may be required to include the name of your bank on that check. While that can be frustrating at times, it is necessary based on your loan that the bank be notified as they have an insurable interest in protecting the asset.
I should say something about percentage deductibles here. You would be wise to ask how a percent deductible works, 1% of what? It is a percentage of the coverage A, the dwelling coverage for your house. So, if you have a home with $500,000 in coverage A, a 1% deductible is $5000. I try to stay clear of percentage deductibles for two reasons. First, most people assume it is a percent of the claim. So, they calculate that if the roof costs $20,000, their deductible is only $200. That would be incorrect. The second reason is that Coverage A changes every year and thus your deductible changes every year. So, when you purchase your home with $500,000 for Coverage A and a 1% deductible you may be prepared to pay $5000 if you have wind or hail damage. But in a few years Coverage A may adjust upward due to the market or due to the inflation protection built into your policy. If that rises to $700,000 you may be surprised when the storm comes, and you must shell out several thousand more than you anticipated. So here we like dollar deductibles rather than percentages.
A tree landing on your car is covered by your car insurance if you have comprehensive coverage on that vehicle. If it is an older vehicle and you decided to purchase liability only then there would be no coverage for the car.
Comprehensive coverage is associated with its own deductible as well, perhaps $500 or $1000. Like your home policy, the insurance company will take the cost of the repair, subtract your deductible and write a check for the difference. If you “bundle” your insurance, where you insure your auto and home with the same company, that company may offer a benefit where you only pay one deductible for the same loss across multiple items. This is nice if wind or hail damages your home as well as multiple vehicles.
In either case, whether there is damage to your home or a vehicle, there may also be some coverage provided for the removal of the tree. This is usually limited to 5% of your policy amount in the case of your home and it may be limited to dragging the tree off your vehicle in the case of your auto.
If my tree falls on my neighbor’s house or car…
Except for very rare circumstances you are not liable for damage to a neighbor’s property when your healthy tree falls due to an act of nature. Even if the tree was unhealthy, you may not be liable. To create liability your neighbor would need to inform you of the danger being caused by an unhealthy tree and then they would need to have proof that they did so.
This same situation in reverse means that your neighbor is also not liable for damage to your home or vehicle. You should be aware and inform your neighbors if you suspect a tree is unhealthy or dead. You can talk to them and let them know verbally. If they seem uninterested in mitigating the issue, then you can send them a certified letter stating that you believe the tree is a hazard (be sure to say why) and that since they have been informed, they will be liable for damage caused should it fall. I advocate for being extra friendly and even offering to share in the mitigation costs if possible.
The danger of a diseased or a dead tree is that it can be deemed “expected or intended” when it comes down. Policies exclude coverage for things that an insured should reasonably expect or even intend to cause damage. This kind of negligence may lead to liability but might also be denied by the insurance company. If a neighbor informs you of a hazard, take that seriously.
If a tree falls in the yard…
When the wind causes a tree to fall but it causes no other damage, there is likely no coverage or help with removal costs. Some policies may be enhanced with additional coverage that would help remove it but on a standard policy, there is no claim to make since insurance is there to cover damage to your home and its appurtenant structures or your auto.
Ask ahead of time
You should find out before the wind blows how your company will cover this kind of loss. Know what your deductible(s) are. Check what the policy limits are. Read to see what type of policy you have. Note how old your roof is and whether your company has a trigger for Actual Cash Value settlement. You should review your home insurance at least every 3 years and review your auto insurance when you do.
Insurance is intended to cover sudden and accidental losses. It is intended to get you back to where you were prior to the loss as best as possible. Most insurance companies want to take pride in their claims service and most agents want to write good policies. As an independent agency we weigh the importance of getting the best premium for our clients against making sure that the coverage is appropriate as well.
[1] If your policy has an Actual Cash Value settlement option then there is an additional reduction in the payout based on the depreciation of the home or the damaged portion of the home. This is becoming more common with homes that have roofs reaching a certain age. It could be as short as 11 years old or as much as 25 years old.
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