All of a sudden, bedbugs are hot. But what could bed bugs possibly have to do with an article dealing with errors and omissions? As it turns out, quite a bit. I recently put out a request regarding the availability of coverage for damage to property as a result of insect infestation or rodent damage. I received a number of responses corroborating my opinion that coverage is and was available. In addition, many of the respondents wanted to know if the issue related to bedbugs.

Related: Read “Reality bites.”

My issue was not bedbugs, but rather damage by insect infestation on a commodity during transit and in storage at a covered a warehouse. I am researching a case where the proximate cause of damage to the commodity was insect infestation. The client requested coverage for all possible risks that might occur to his property while being warehoused and in transit. The insured's agent responded by providing his client with an “all risk” inland transit policy with a warehouse extension. The inland marine policies, like most property policies, contain an exclusion regarding damage by insects and rodents. What happened next is obvious: The insured shipped its products to a customer, who discovered damage by insects after receiving the product. To make matters worse, subsequent investigation revealed insect damage to inventory owned by the insured at the covered warehouse.