We asked Dawn M. Becker-Durnin, CIRMS if there was any insurance coverage for community associations in regard to insects and vermin.
“I am not aware of any insurance for insects or vermin.”, said Dawn
Dawn added, “Commercial property and homeowners insurance policies excludes such, typically, because the damage is over time or progressing and ensuing. Insurance is intended for sudden and accidental. If a building were to collapse due to termite damage; the collapse may be covered however the rotted wood/trusses etc. damaged by insects/vermin would not be covered. I would bet the carrier would initially decline to pay the claim and there would be arguments by engineers to certify specific causes to the loss and then the loss would be devalued by the insect/vermin damaged portions of the building.”
“There are “termite bonds” is an agreement by a pest company with a homeowner to provide termite treatment and if there is termites, it will provide that the pest company will try and irradicate them with treatments and inspections, then keep monitoring the infestation for reoccurrence, continue treatment and if there is damage pay the cost of the repairs. It is a bond that is purchased by the owner but I believe can only be utilized with a specific company for the lifetime. We have one on our house here in the South.”, Dawn said.
Dawn continued, “Think of it like a credit card, it has to be repaid and there are annual costs. A bond is not an insurance policy; if the bond is called then the surety company will take the assets of the pest control (or obligee and their heirs and their heirs heirs and their heirs heirs heirs, so on and so forth until the bond is repaid).”
Dawn provided this link reference termite bond – https://riddabugs.com/termite-bond/
If you have any additional questions please feel free to contact Dawn.
Dawn M. Becker-Durnin, EBP, CIRMS
Vice President, Insurance Advisor
Acrisure Property & Casualty