Your Neighbor’s Tree is on your building. Which policy pays?

If a tree falls in your neighbor’s yard, does it still make a sound? Yes, especially when it falls on your utility shed 🙁  Here’s the call I received from a customer recently- “I think I know the answer to this, but wanted to call anyway. The high winds knocked my neighbor’s tree onto my shed. Her homeowner liability would pay to fix the shed, right?” Imagine his surprise when I replied “No, the tree fell in your yard, so your homeowner policy pays to remove the tree and fix the shed.” SILENCE. I think I even heard crickets.

Then the sputtering began- “What? How can that be? It’s HER tree. It should be her responsibility.” Believe you me, I totally understand where he’s coming from. It does seem rather unfair that my customer’s policy would be required to pay the claim, doesn’t it?

But you have to first understand the basis of most liability insurance claims is the concept of negligence (the insurance policy is a legal contract after all). Negligence is composed of 4 parts, which are: Duty owed, Breach of Duty, Proximate cause, and Damages. Let’s move backward through this example to see how it would apply:

• Damages- Yes, the shed was damaged due to the tree falling on it.
• Proximate cause- High wind knocked over the tree, which in turn caused the damage to the shed.

I’ll lump the final two together- Duty Owed and Breach of Duty. This is where the logic breaks down. Who had a duty to make sure the wind didn’t blow so strongly? The neighbor? Of course not. She had no control over the weather (and I assume still doesn’t). So if she has no duty owed, then she can’t have a breach of that duty. Therefore you can’t hold her liable. And the insuring agreement in most homeowner policies usually says something like this- “We will pay what we are legally obligated to pay…….”

Those that want to collect under Mother Nature’s policy, by all means give it a try. Please let me know how that works out 🙂

Thoughts? Do you understand the example? Have others to share? Does this shed a bit more insight or help you?

I welcome your comments. As always, thanks for reading.