Some Insurers Using Legal Contracts To Refuse Calgary Insurance Claims

By: Daniel Rattanamahattana on July 5, 2013

Some insurance companies in Alberta are paying out claims from flood-ravaged homeowners, while other companies are refusing to do the same.  Albertans whose claims were rejected are uniting in opposition against their insurers.

The controversy is of particular concern for residents in Calgary’s Elbow Park neighbourhood, located near the Elbow River.  Representatives from the insurance companies assessed the damages to each of the homes, and determined many of the damages were a direct result of flooded sewer backups.

Residents subsequently submitted sewer backup claims to their insurers, and in many cases the claims were validated.  However, homeowners singled out RBC Insurance and AMA Insurance as two companies refusing to accept the claims, despite similar insurance contracts.

Flood victims began returning to their homes over the past week, and many RBC and AMA customers are putting signs on their lawns denouncing the companies.  The IBC’s Alberta offices attempted to defuse the growing public relations standoff by reminding residents that each insurance policy is different.  However, most residents in Calgary, including people who insure with a different company, are united in their condemnation of RBC and AMA.

Responding to the growing public anger, Troy Bourassa, Director of Claims for AMA Insurance, says damages from sewer backups aren’t inherently included in home insurance.

Ours excludes damage caused by flood and excludes sewer backup damage when that sewer backup was caused directly or indirectly by flood.”

Bourassa confirms that AMA will stand by its insurance terms, and stands by the assertion that the sewer backup damages were a result of flooding from the Elbow River.  Meanwhile, RBC Insurance has so far refused to comment on the growing public relations fiasco in Calgary.