Allstate Indemnity Coverage And Termite Damage Clause - 4 Important Facts For Homeowners
The issues surrounding Allstate indemnity coverage and termite damage have not only been raised within our courts, but have also been a great cause of concern to policy holders. For clarification purposes, one can define an indemnity policy as a policy which indemnifies a property owner against future loss and which would be filed by someone other than the property owner. In the majority of cases, issues arise during transactions involving real estate where cases of termite damage are identified. A prime example of this would be a case which involved Allstate Indemnity Coverage and Termite Damage, wherein the property buyer filed a suit against the seller of the property in question.
1. Staking the claim
The case in point arose as a result of the discovery, by the buyer, of termite damage within the home. The buyer filed suit against the sellers for non-disclosure of the defect. The sellers responded by attempting to claim on the Allstate indemnity coverage and termite damage clause in their policy. The claim was repudiated by Allstate and the sellers were instructed to repair all damage and compensate the buyers for any losses incurred. The buyers also attempted to claim against their own homeowner's policy. Allstate, holders of the buyer's homeowner's policy, denied their claim.
2. Coming clean on the clause
After the denial of both claims, the purchasers and the sellers collaborated and jointly filed suit against Allstate for breach of contract. They were of the belief that the policy covered structural damage to a property caused by termites. Allstate defended the action and stipulated that a homeowner's policy covers only harm to another party, and not structural damage inflicted by termites. They further argued that the Allstate indemnity coverage and termite damage clause did not cover pre-existing damage caused by termites. As there was no physical injury to any party in this case, Allstate requested that the case be dismissed.
3. After the long haul, it is time for the overhaul
The parties finally reached settlement on the issue, but the net result of this case had a large bearing on the insurance industry. Many of the insurance companies have subsequently been more thorough in detailing the specifics of their indemnity cover in regard to damage caused by termites. Accordingly, the Allstate indemnity coverage and termite damage case resulted in a substantial overhaul of homeowner's policies. The result of this was that the majority of indemnity policies now offer limited coverage for termite damage, unless an individual is physically injured as a direct cause of termite damage.
4. Homeowners 1, Insurance Companies 0
For many homeowners the Allstate indemnity coverage and termite damage case had a favourable outcome in that it clarified the exact terms of the policy. As a result, insurance companies were forced to examine their policy documents more closely and policy holders are now better informed as to the coverage they are receiving. In this instance, it appears as if the homeowner has benefited to a greater extent than the giants of insurance.
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