Insurer Applies 'Pollution' Exclusion in Fire Deaths from Smoke Inhalation
In a move that could stretch the traditional definition of “pollution” to the breaking point, an insurer in Texas has asserted the pollution exclusion in its commercial liability policy in an effort to avoid covering the deaths of three people from smoke inhalation in a 2007 Houston office fire.
“Great American Insurance Company is arguing in a Houston federal court that the section of the insurance policy that excludes payments for pollution—like discharges or seepage that require cleanup—would also exclude payouts for damages, including deaths, caused by smoke, or pollution, that results from a fire,” reports the Houston Chronicle. The pollution exclusion in the policy at issue expressly includes smoke, fumes and soot in its description of pollution, the article says.
The insurer is an excess carrier in the case which has contracted to provide coverage after the underlying primary liability insurance policy limits are exhausted, according to the newspaper.
Although law professors say this interpretation of the pollution exclusion is a significant departure from the way the term pollution traditionally is understood, it is possible that Texas law might permit smoke from a fire to be determined to be “pollution” under the literal language of the policy, the Chronicle reports.
There apparently is little or no Texas case law on point addressing this novel argument concerning smoke from a fire. However, nationally carbon monoxide has been found not to be included in the definition of “pollution,” and thus related injuries are covered by liability insurance.
A vocational nurse who reportedly set the fire to cover up the fact that she was not up to date on her paperwork is serving a 25-year prison term for felony murder and arson.
