Pipeline won’t affect homeowners insurance rates, expert says
WEST CHESTER » Regardless of the distance of a pipeline to your property, there should be no increase in the cost of your homeowners insurance policy, said 25-year veteran insurance agent Mark Sammarone, vice president of Arthur Hall Insurance.
“Just because there’s a utility line running close by, that has no bearing on the insurance,” Sammarone said. “There’s no impact by simply being in proximity to a utility.”
Sammarone was part of an expert panel at a June pipeline safety meeting at Fugett Middle School organized by state Rep. Carolyn Comitta, D-156. He prepared, and distributed, a white paper for the event.
Residents may be concerned about all possible impacts of the now-underconstruction Sunoco Mariner East 2 pipeline planned to carry volatile liquids for 23 miles through Chester County.
The pipeline is designed to stretch 350 miles from Marcellus Shale Deposits in West Virginia, Ohio and western Pennsylvania to the refinery in Marcus Hook, Delaware County.
Sammarone said that rates are formulated using predictive models, much like a credit rating, which include the municipality, fire protection services, value or the home and whether cars are also insured by the same company.
Rates are determined by a variety of data points concerning the insured themselves, including, credit score, length of time at the house, length of time with a prior insurer and how far in advance coverage was applied for.
Even claims made by a previous owner might be considered.
Rates might climb and surcharges kick in if multiple claims were made during the past three years.
Those claims could be made from anything pipeline-related, including a construction vehicle running into a tree or a motorist dodging a barricade and causing damage.
American insurance was first designed to simply cover loss from a fire. Since then, insurance has grown to cover a variety of losses.
An insurer will sometimes exclude certain losses on a policy such as from sinkholes and earth movement. Exclusions can include damage by earthquakes and sinkholes, which can be added back on by a special endorsement.
“Sometimes people expect too much from a homeowners policy,” Sammarone said. “But if you lose your house such as with a fire, and explosion from the pipeline, the insurance policy would respond the way you would normally expect.
“The insurance company’s obligation is to rebuild your house.”
Common exclusions, as listed in the white paper include, ordinance or law requirements, earth movement, flooding (National Flood Policy might not cover) and loss from power failure.
Other exclusions include, neglect, nuclear hazard, intentional loss or government action, including confiscation or seizure of property or faulty planning.