Over the weekend, a passenger airplane experienced a catastrophic engine failure showering engine parts over multiple neighborhoods. Almost as soon as social media started showing pictures of airplane parts in people's yards, insurance social media started talking about coverage for property damage caused by those parts. So here we are. Since a lot of yards are involved, let's look at the homeowners policy.
In section I of the policy, under property not covered, aircraft, including any parts whether or not attached to aircraft, are not covered. However this does not mean airplane parts falling from the sky are not covered; like motor vehicles, this is referring to aircraft an insured might own, not one losing parts as it flies overhead.
Next we come to debris removal. This coverage is for removal of covered property if a peril insured against damages the insured's property. So we have to continue to determine if falling airplane debris is a covered peril. Remember under the HO 00 03 coverage is open perils for Coverages A and B. There is no exclusion for falling objects from the sky, be they hail, airplane parts, UFOs or whatever. So any damage from falling airplane parts to the dwelling, as well as removal of the parts or other debris, is covered.
But what about personal property? What if part of the plane crashed through the roof and damaged personal property? Personal property is named perils, and the peril of falling objects fits. There is no description of the type of falling object that qualifies for coverage, so anything will do. As long as the object fell through the roof or wall of the dwelling before damaging personal property inside the house, then there is coverage.
But what about a named perils form, such as the HO 00 02 Broad form? That follows the Coverage C falling objects peril found in the HO 00 03; falling objects are a named peril, and for objects inside the dwelling, the falling object must have damaged the roof or exterior wall.
But the parts didn't just land on houses or yards, they landed on vehicles as well. One person had a piece land in and crush his pickup truck. Falling objects are covered under other than collision coverage.
Under the CP 10 30 Special Causes of Loss form, falling objects is listed as a "specified cause of loss", although damage to property in the open is not covered. Some items are only covered by the "specified causes of loss". Under the CP 10 10, objects falling from aircraft are included in the named perils.
While coverage exists, this is a little different. The National Transportation Safety Board (NTSB) investigates all airline accidents, and will likely arrange for the debris to be removed once it has conducted its investigation. It has requested that the parts not be moved until they can investigate. Once the NTSB has investigated and the parts have been removed, carriers can pay the insureds and then subrogate against the airline, unless the airline informs people how to file claims with them directly. However insureds always have the option of having their carrier pay the claim and the carrier can subrogate against the responsible party.