Does homeowners insurance cover fences?
Here in the beautiful Pacific Northwest, many of our homes are surrounded by big tall trees. As homeowners, it is our responsibility to take care of these trees and to ensure they are healthy.
Unfortunately during our annual storm season, even healthy trees may not be able to withstand a severe windstorm and fall on our property such as fences.
The good news is that your fences are insured against covered perils as part of your homeowners insurance policy under other structures coverage. This coverage is designed to cover any buildings outside of your main dwelling structure.
The coverage will pay for the cost to repair or replace your fence against these examples of covered perils:
Keep in mind that most insurance companies will consider the age and condition of the fence in its payout, which we will go over in the next section.
How to estimate repair or replacement payout?
Specific to wooden fences, most insurance companies use a value estimation method called actual cash value (ACV). ACV takes into consideration the cost to replace a damaged fence and how long the fence had been in use.
It's also important to note that if you have a shared fence with your neighbor, it is considered an equitable property.
It means that both you and your neighbor have equal responsibility to maintain the fence. Your insurance company is likely to use the same equity consideration in determining the claim payout of a shared fence.
Here is a simplified example of an ACV formula:
According to a IRS publication, a fence has 15 years of useful life. Using an example of a fence that was installed 5 years ago, it has 10 years or 66.7% of useful life remaining.
Most homeowners policies have a deductible ranging between $500 to $1,000. We will use $500 as an example in this illustration.
Total payout estimation:
- Estimated replacement cost: $5,000
- Current condition: 5 years old with 15 years of useful life
- Deductible: $500
- Shared fence: Yes
$5,000 (replacement cost) x 66.7% (useful life) x 50% (shared fence) - $500 (deductible) = $1,167.50 (estimated payout).
Keep in mind that each insurance company uses its own variables to determine composition and condition of a fence. Our example is only to be used as a general illustration of how ACV is calculated.
What if neighbor's tree fell on my fence?
In any situations involving damages to your home or property, always consult your own insurance agent to file a claim. In a covered situation such as a tree falling on your property, your own insurance company is responsible to take care of your damaged property regardless whether the tree belongs to you or your neighbor.
In a shared fence situation, it may be a good idea to talk to your neighbor and discuss an amicable solution to repair the fence. After all, both parties have equal financial responsibility for the shared fence and the insurance payout will likely be only half of the total cost.
Procedures after a tree fell down on your fence
Be sure to document the incident by retaining several photos of the tree and the location where it landed.
Not only can these photos be used as evidence to indicate if the tree was dead or diseased at the time of the loss, but they can also be used to confirm the damage it caused on your property.
Your insurance company will always launch an investigation on these types of claims. In many cases, your claim adjuster will consult with a certified arborist to confirm whether the fallen tree was, in fact, not healthy.
What if the tree fell down because it was not healthy?
If the tree that fell on your fence was dead or diseased, the owner of the property where the tree was located would most likely be liable for your fence damage. Property owners have a duty to upkeep and maintain the health of all trees on their property.
If your neighbor was found liable for the claim, your insurance company will likely pursue his/her insurance company to recover the total costs of the claim payout. In the event that your insurance company is successful in recovering the payout, you may be reimbursed for the deductible that was paid towards the claim.
