The FloodFlash sensor

Premium payment and waiting period

Making a claim

If someone else is to blame for your claim

If you need to cancel

What isn't covered under this policy

Service of suit clause

Law and jurisdiction

Making a complaint

For ease of use our analysis will be broken into multiple sections; each section will link to the other sections. This article will discuss the first four sections beyond the definitions – Our promise to you, Your promise to us, The FloodFlash sensor and Premium payment and waiting period. There are certain sections set aside in a blue box in the text providing additional information. We will indicate those sections with blue text and discuss as needed.

1. Our promise to you 1.1. We agree to pay you the lesser of the actual loss sustained and payout amount in the schedule if a measured flood event occurs subject to the details in this policy. 1.2. This policy shall pay for up to two measured flood events occurring during the insured period for each trigger depth. This means that

(a) the payout can be split across two claims (b) you will not receive more than the payout for each trigger depth in the insured period (c) you will not be able to claim again even if the FloodFlash sensor is triggered more than twice.

1.3. Once you've had two claims or the payout has been reached, you need to request a new quote in order to reinstate cover at that trigger depth.

You can only receive the payout and no more for each trigger depth in the insured period. That means once you've had up to two claims amounting to or exceeding the payout, you need to request a new quote in order to reinstate cover at that trigger depth.

Analysis

The sections Our promise to you and Your promise to us provide the insuring agreement between the insurer and the insured. Under Our promise to you, the insurer agrees to pay the lesser of the actual loss sustained and payout amount in the schedule if a measured flood event occurs subject to the details in the policy. What the policy is trying to say is that if the scheduled payout amount is $50,000 and the actual loss sustained is $100,000, that $50,000 is what the insured will receive since that is the lesser of the two amounts.

Next, the policy states that it pays for up to two measured flood events within one policy period for each trigger depth. This allows three things; for the payout to be split between two claims, that the insured will not receive more than the payout for each trigger depth in one policy period, and that the insured will not be able to make another claim once two claims have been filed in one policy period. If an insured has had two claims within one year or the payout has been reached, the insured needs to request a new quote to reinstate coverage at that trigger depth.

For example, an insured's limit is $500,000. He has one loss in April for $300,000, and another loss in September for $200,000. Since the total of both claims equals the total amount of the policy limit, both claims will be paid in full. However, if the second claim totaled $500,000, then only $200,000 would be paid since the limit would be exhausted once a total of $500,000 is paid out. The policy is working on an aggregate basis, and the payout is the aggregate limit. If an insured sustains a loss and receives the full payout amount, he will need to request a new quote to continue coverage.

2. Your promise to us

2.1. You promise the following:

(a) you shall not move, cover the surface of, paint, tamper with (physically, electronically or otherwise), damage or destroy the FloodFlash sensor,

(b) you will report any obvious signs of damage or faults concerning the FloodFlash sensor by emailing [email protected] or calling +1 888-207-1026 as soon as possible,

(c) you will not, by yourself or with others, seek deliberately to cause and / or exacerbate a flood and / or to trigger the FloodFlash sensor via arson, vandalism, gross negligence, malicious damage or any other action,

The FloodFlash sensor is tamper proof, storm proof and built to last 10+ years. It is unlikely to need repair or replacement in that time. If it does, please let us know. Do not attempt repair yourself.

(d) you will not attempt to repair the FloodFlash sensor,

(e) you will tell us if any of the information on which this insurance is based changes. If you don't know whether you need to tell us about a change, please notify us anyway. If you tell us about a change:

i. we will not be deemed to have accepted the changes until we confirm in writing, and ii. we will work to provide an updated quote for this policy so that cover can remain in place. Any changes you submit may lead to updates to trigger depth(s), payout amounts or premium. You will be under no obligation to accept the updated quote, but we will not accept the changed risk until you do so. Failure to agree any changes may result in the policy no longer being valid and you not receiving a payout if a measured flood event occurs,

(f) you must have a legal or equitable interest in the insured premises at the time of purchase of this policy and expect to maintain this interest during the term of this insurance.

Analysis

The policy then provides the insured's obligations to the insurer. Because the insurer installs the FloodFlash sensor, it is important that the insured not move, cover, paint, tamper or otherwise damage or destroy the sensor. Without a working sensor, a flood can not be detected and payment cannot be made.

Any signs of damage or malfunction to or with the sensor should be reported at once to the company at the email or phone number provided. Again a working sensor is required in order to detect a flood, so any malfunction should be addressed immediately.

The insured is not to try to cause a flood or trigger the sensor by any artificial means such as arson, vandalism, gross negligence, malicious damage or other means. This includes the insured acting alone or in conjunction with other people. Artificially triggering the sensor or causing a flood in order to receive claim funds is insurance fraud.

The sensors are durable, and the policy states that they are built to last over ten years and withstand storms and tampering. Insureds are not to attempt repairs if a sensor should fail, the company should be contacted for repair.

If there are changes to the information that the policy was based on, the insurer needs to be notified. An insured could modify the property, want to change the trigger depth, or have some other change on the premises. If an insured is unsure as to whether a change is significant enough to mention, the company should be advised anyway so it can provide guidance. Changes are not considered to have been accepted by the company until they have been received in writing, and once received the company will work to provide an updated quote so coverage can stay in place.

The insured is not required to accept the quote, but the policy will not be changed and the company will not accept the risk until the insured does so. For example, if the insured adds on a new section to the building, that will change the size and value of the exposed property. If the insured does not accept the quote the policy may no longer be considered valid, and the insured would not receive funds if a loss occurs.

Lastly, it is required that the insured have a legal or equitable interest in the property insured when the policy is acquired. The insured is expected to maintain this interest throughout the policy term.

3. The FloodFlash sensor

3.1. This policy is subject to a FloodFlash sensor being installed by our engineers.

3.2. The sensor must be installed before the end of the waiting period. If we are unable to reach adequate arrangements for installation of the sensor with you before the end of the waiting period, we will give you a 14-day notice of cancellation. At the end of this notice period, if the sensor has not been installed, we will cancel the policy and return premium and FloodFlash sensor fee to you calculated pro-rata.

Meet the claims department How the FloodFlash sensor works

The sensor records water depth at the insured premises. It requires no power or internet connection. Once installed you don't need to do anything else unless to report that the sensor has been damaged or stolen.

In the event of a flood, the sensor records water depth data every 5 minutes. The sensor then sends the data to us at regular intervals via mobile networks. This is how we know it is working. If we stop receiving data, we know to investigate the sensor for repair or replacement.

When the sensor records water depth at or above the trigger depth detailed in the schedule, it is triggered. That's when we start your claim process. If you have more than one trigger depth in the schedule this occurs separately for each trigger depth. In other words, we treat each trigger depth as a separate claim.

You can find more information on the sensor at www.floodflash.co/blog.

3.3. The sensor must be installed at a point that is:

(a) on the outside wall of the insured premises detailed in the schedule,

(b) not in a drain, stairwell or other depression that takes the sensor below ground elevation, (c) not on a wall that touches or abuts water, and

(d) your choice. Our engineers cannot advise you where to place the sensor.

3.4. If we discover that the sensor has been installed incorrectly based on clause 3.3(a) we will not make a payout if a measured flood event occurs until the sensor is installed correctly. We will organize an engineer to move the sensor at a cost to you of $150 + applicable taxes.

3.5. The FloodFlash sensor is our property and will be rented to you at an annual cost of $200 + applicable taxes. Initial installation is provided at no extra charge.

3.6. If you want to move the FloodFlash sensor after the initial installation, either at renewal or at any other point in the insured period, we will charge you an additional fee of $150 + applicable taxes.

3.7. You agree to allow our engineers to access the insured premises for sensor installation or maintenance upon reasonable notice given from us to you.

3.8. You will allow us to access the sensor during normal working hours, whether before or after any flood or potential claim.

3.9. Where you have reported any obvious signs of damage to the FloodFlash sensor in accordance with clause 2.1(b), we will arrange for it to be repaired or replaced promptly except when you or any person associated with you has deliberately caused any such damage.

Analysis

Part 3 provides details on the installation and use of the sensor. The FloodFlash sensor must be installed on the property, by the company's engineers, in a location chosen by the insured. Having said that, the sensor may not be placed below ground level, in a drain or stairwell, or other location that takes the sensor below ground elevation. It cannot be put on a wall that abuts water but it must be on an outside wall of the insured premises. The engineers will install the sensor but will not advise the insured as to where the sensor should be installed; that is the decision of the insured.

If it is discovered that the sensor has been installed incorrectly based on clause 3.3(a) then no claims will be paid until the sensor is correctly installed. The company will send an engineer to move the sensor at a cost of $150 to the insured plus taxes. If the insured wants to move the sensor to another location, the same applies and the insured will be charged $150 plus taxes for an engineer to come out and move the sensor.

The sensor belongs to the company and is rented to the insured for a $200 annual fee plus taxes. Engineers must be able to access the property in order to install or maintain the sensor during normal working hours, with reasonable notice to the insured from the company that an engineer will be on the property. If the insured notifies the company that the sensor has been damaged, the company will arrange for it to be repaired or replaced, unless the insured or someone associated with the insured intentionally caused the damage.

The sensor must be installed within the fourteen-day waiting period. If it is not installed within that time period, then a fourteen-day notice of cancellation will be issued. If the sensor is not installed before the end of that cancellation period, then the policy will cancel and the premium will be refunded on a pro-rata basis.

A separate section is provided that explains how the sensor works. It needs no power, internet connection, or action from the insured unless the sensor is damaged or stolen. The sensor records water depth every five minutes in event of a flood and sends the data to the company at regular intervals via mobile networks. Once water reaches the trigger depth, the company is notified and the claim process begins. The same applies to each trigger depth the insured has selected for coverage. Each trigger depth reached is a separate claim. More information is available at wwww.floodflash.co/blog.

4. Premium payment and waiting period

4.1. You must pay the full premium to us or your insurance broker by the premium due date specified in the schedule no later than 17:00 in the time zone of the insured premises indicated in the schedule. If the premium is not paid by the premium due date, we will cancel the policy.

4.2. During the waiting period no payout under this policy for a measured flood event or otherwise can arise.

4.3. In the case of a renewal policy, the premium must be paid before the policy renewal date. When the premium for a renewal policy is paid in full before the renewal date, there is no waiting period. If you do not pay the premium for a renewal policy in full before the renewal date, cover will end on the last day of the expiring policy.

Analysis

The premium payment section advises that the full premium is due to the company or broker by the due date and at the time specified in the schedule; payments are due no later than 17:00 in the time zone of the insured premises, or 5:00 p.m. If the premium is not received in time, the policy will be canceled.

The waiting period is fourteen days and if a loss occurs during that time no payments are made. Most flood policies have a waiting period and this is no exception.

When a policy is renewed, the premium is due before the renewal date of the policy. When the premium is received before the due date there is no waiting period. However, if the premium is not paid on the due date, coverage ends on the last day of the policy. Again, the premium must be paid in full.