News

Business insurer denies gas leak claim

By Monte Sonnenberg, Simcoe Reformer

The Grant family will be able to return to their home near Langton after an evacuation order was lifted on their property and two others. Last month the properties had been deemed unsafe due to high levels of hydrogen sulfide. JACOB ROBINSON/Simcoe Reformer

The Grant family will be able to return to their home near Langton after an evacuation order was lifted on their property and two others. Last month the properties had been deemed unsafe due to high levels of hydrogen sulfide. JACOB ROBINSON/Simcoe Reformer

SIMCOE - 

An industry spokesperson says business owners who are unsure of their coverage should sit down with their insurance broker and go over their policies paragraph by paragraph.

Pete Karageorgos, the Insurance Bureau of Canada’s director of consumer and industry relations in Ontario, says this is the best way to avoid disappointment in the event of an emergency.

“The last thing you want is to find yourself in need of coverage for an event and find that you are not covered,” Karageorgos said this week.

Karageorgos was asked about coverage precautions after a Silver Hill couple learned their insurance policy does not cover harm to their business arising from a toxic leak of natural gas on North Walsingham Road 10.

Ian and Kim Grant run a wholesale home decor business in Silver Hill called Timbers. They and several other households on North Walsingham Road 10 were evacuated Aug. 18 after unsafe levels of hydrogen sulphide gas were detected.

A total of six households in Silver Hill are under evacuation orders. One of the two old gas wells emitting hydrogen sulphide gas is located on the Grants’ property.

Norfolk council held an emergency meeting Tuesday to discuss the emissions, the evacuations and potential solutions. During a break in the meeting, the Grants said they approached their insurer for coverage under the “interruption of business” provision.

The Grants said their insurer came back with a 19-page document listing exclusions to their coverage. The insurer also told the Grants it has defined the hydrogen sulphide gas at issue as “a pollutant,” something the insurance company says their policy doesn’t cover.

In an interview Aug. 22, the Grants told the Reformer they have orders on the books that they are unable to complete without access to their property.

The Grants were asked this week if it were possible to relocate their inventory to another location and carry on. They said that’s not practical because they work with bulky raw materials that aren’t easy to move around.

Karageorgos says business owners should never make assumptions about their insurance coverage. Taking the time to sit with your broker, ask questions, and understand your policy, he said, is a good investment.

“It’s the same process we should pursue when buying any insurance,” Karageorgos said. “They have to understand what the coverage is and the perils they are protected from. It should be there in black and white what you are covered for and what are your exclusions.”

The gas situation in Silver Hill came to the county’s attention after the Grants asked the Haldimand-Norfolk Health Unit whether higher-than-normal natural gas levels in their neighbourhood were safe. The Grants approached the health unit after the corrosive gas began to discolour metal objects on their property.

Hydrogen sulphide gas is a by-product of natural gas production. It is toxic, flammable and smells like rotten eggs. The Grants have said the smell of natural gas in their neighbourhood has been more noticeable than usual for nearly two years.

A contractor hired by the Ministry of Natural Resources & Forestry was expected to get to work this week on filling in and capping the leaky well on the Grant property. At last report, the ministry is working on a similar solution for a second well in the area that is also emitting hydrogen sulphide gas.

MSonnenberg@postmedia.com