Many owner's faced with problems due to soils movement submit a claim to their homeowner's insurance policy. Will a typical homeowner's policy cover claims related to soils movement? The unfortunate answer is almost always no. The typical homeowners policy is known as an All risk policy. An all risk policy has been determined by the Courts in most jurisdictions to cover all risks associated with the property, except for those risks that are specifically excluded. In the 1980's, many homeowners successfully pursued claims against homeowner insurance carriers for damages related to soils movement. In response to these claims, the insurance carriers began to rewrite their policies to specifically EXCLUDE any claims related to earth movement. These policies have been written is such a manner that virtually any type of damage related to subsidence, expansive soils, or other types of earth movement will not be a covered loss under the policy. For the last 25 years, the general rule is that any claims related to earth movement are specifically excluded from the typical homeowner policy, and will not be a covered loss.
The next question is, should the homeowner still make a claim for damage related to earth movement against the homeowner insurance carrier? The definite answer is yes. The carrier has the obligation to investigate the claim. They have the obligation to determine the cause of the damage. It is possible that what the homeowner suspects is a soils claim may be determined by the carrier to be caused by a covered risk. At a minimum, the carrier will need to investigate the damage, and will provide the owner with information about the nature and extent of the claim, whether or not it is a covered loss.