Recently there has been some discussion at formal meetings and social media surrounding the recent resolution passed by the Seeley Lake Fire Department (SLFD). Our intention is not to do anything other than explain how standard home and auto insurance companies would respond to the adopted resolution. We have worked together and spent hours personally, as well as staff hours, reading policies, talking directly with claims representatives and managers, and calling carriers and asking the right questions. Here is what we have found.
We will start with home insurance as this area potentially provides coverage for a Fire Department Surcharge. This coverage is found on a standard homeowner policy and is stated as such:
Fire Department Service Charge: We will pay, up to the amount shown in your Policy Declarations, as an additional amount of insurance, for your liability assumed by contract or agreement for fire department charges incurred when the fire department is called to save or protect covered property from a loss we cover. We do not cover fire department service charges if the property is located within the limits of the city, municipality or protection district furnishing the fire department response.
This statement means that the standard carrier using the standard form will cover the Fire Department Service Charge on two conditions. First, the department must be called to ‘save or protect covered property from a loss we cover.’ This means that if your home policy would cover the loss (i.e. a tree falling on your propane tank causing a fire), the policy would provide coverage for the service charge.
The second condition is that said property must be located outside the ‘limits of the city, municipality or protection district furnishing the fire department response.’ This means that the physical location of the client’s home must be outside the response area for SLFD. For example, if the SLFD responded to assist Swan Valley Fire Department, and thus charged that client a service charge, the home insurance would pay as the property is located outside limits of the city, municipality or protection district furnishing the fire department response.
The inverse is true as well. If a resident of the Double Arrow called 911 and SLFD responded, this coverage would not apply to the service charge as that homeowner lives ‘within the limits of the city, municipality or protection district furnishing the fire department response.’ That Double Arrow client would likely be responsible for the bill issued per the new resolution.
Now, it’s fair to note that each client needs to consult their individual policy or call their agent directly for confirmation. The policy language noted above is ISO standardized language. Your individual carrier may have broadened this coverage line.
Auto policies have either a liability side, property side or both.
The liability side of any insurance policy is designed to cover the named insured against any bodily injury or property damage they cause a third party. If your parked car was hit by another party, the claim would be paid by the offending party’s liability section of their auto policy. If you cause bodily injury or property damage to a third party, your liability section of your auto insurance would pay out.
Conversely, the property portion of an auto policy is designed to cover the named insured’s asset or the vehicle itself. Comp and collision coverage are present for when you get into an accident and either you are at fault, or there is no third party (hitting an animal for example). This coverage is present to make the named insured whole after a loss. This coverage does not pay out to a third party.
The question of whether an auto policy would pay the requisite fee to the SLFD rests in whether or not one could find coverage from the liability section of the policy. In order for any auto policy to pay to a third party from this section, the named insured must be deemed liable for bodily injury or property damage to that third party.
Since we are discussing the response of the Fire Department to an accident that has already taken place, there is no bodily injury or property damage caused by the named insured to the fire department. As such, there is no coverage. This means that the insurance company would not pay the surcharge bill to the fire department.
Between our two offices, we spent hours contacting carriers we represent as well as carriers we do not represent. All were in agreement that the charge would not be paid by the policy with exception to one carrier in Montana – Hagerty. Hagerty is a carrier that insures classic cars only and has a loss settlement provision not available in standard auto insurance.
The short answer to the question of whether or not a standard auto insurance policy would cover this new fee is no.
The bottom line for suggestions, from both local insurance agencies, is to contact your agent or carrier directly. One cannot assume that your policy provides coverage. As stated above, if you live within the protection district of SLFD, you will likely be responsible directly for any billing as your insurance will not provide coverage.
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