WIN Magazine - Summer 2017 - 45
N RECENT WEEKS, NORTHERN CALIFORNIA EXPErienced an unprecedented mandatory evacuation
of more than 188,000 people living and working
along the Feather River, below the Oroville Dam.
Dangerous levels of erosion led to failures in both
the main spillway and the emergency spillway,
and debris from these failures blocked the outlet for the
power plant as well. As Lake Oroville's water level rose,
and the dam's ability to release water came into question,
evacuation orders went out.
Homeowners and businesses in a number of riverfront
communities were abandoned as residents complied with
the massive evacuation order. Had the tallest dam in the
United States (Oroville Dam, 770' tall) failed, more than
4 million acre feet of water would have come crashing
down into the Feather River, more or less all at once. An
acre foot of water is the amount of water it takes to cover
an acre of flat land 1 foot deep with water, or 325,851 gallons; 4 million acre feet is 1,303,403,800,000 (1.3 TRILLION)
gallons of water. That would have triggered the type of flood
that could only be handled using a large boat and animals
gathered two by two.
As it happened, though, the dam was not compromised;
the damaged spillways were nursed along with just enough
water released all day every day to keep the lake level within
tolerances. The Great Oroville Flood of 2017 was averted.
And yet, there were still economic losses to the residents
and businesses in the region. For more than two days, the
civil authorities had mandated an evacuation; employees
could not report to work, and customers could not walk
in the door. The residents of Oroville and the rest of the
Feather River corridor communities were very fortunate:
had the prevailing weather pattern not dried up somewhat,
the evacuation order might have been extended for weeks.
Had the dam been overtopped or otherwise compromised,
the evacuation might have lasted for months in the hardest hit areas.
"In simple terms, Civil Authority coverage is triggered if all
of the following elements are met:
1. government authority prohibits access to the insured property
(or dependent business);
2. the prohibition was issued as a result of physical loss or
damage caused to property within a one-mile radius of the
insured property; and
3. the time element deductible ("waiting period") is met." - "The
Nuances of Civil Authority Coverage - Understanding
Business Interruption Claims" 6/17/12 Merlin Law
Group, posted in Commercial Insurance Claims.
Business owners are often protected from loss of business income due to the order of a civil authority under their
commercial property policies. The Insurance Services Office
(ISO - a Verisk Company) commercial property form CP 00 30
(Business Income) includes an additional coverage called
Civil Authority that extends coverage for actual loss of business income (and extra expense, if that option is selected)
"caused by action of civil authority that prohibits access to
the described premises due to direct physical loss or damage to property, other than at the described premises, caused
by or resulting from any Covered Cause of Loss" (emphases
added). In the ISO form, this coverage "begins 72 hours after
the time of that action and will apply for a period of up to
three consecutive weeks after coverage begins."
AAMGA.ORG | S U M M E R 2017 | 45