Professional Independent Insurance Agents of Illinois (PIIAI)
Offers Fourth of July Tips for Homeowners

Even though you have purchased fireworks and obtained a permit, you may not be prepared for the upcoming 4th of July holiday. Homeowners should consider the risk of fireworks-related accidents and understand that their homeowners insurance may not provide coverage in certain situations. The Professional Independent Insurance Agents of Illinois (PIIAI) advises consumers to check their homeowners and personal umbrella policies to see what type of coverage they have, and to reduce the risk of fireworks-related accidents by taking some basic precautionary measures.

Many homeowners assume they are covered for any type of accident that occurs around their home; however, whether or not you are covered for a fireworks accident depends on the circumstances. Insurance companies will probably not consider paying a claim if:

• You have a state, county or municipal law/ordinance outlawing fireworks or if the law only allows professionals to operate them.
• Your area does not allow the types of rockets used in the incident. Whether or not you purchased the fireworks legally elsewhere, the insurance company will not pay.
• Your local law/ordinance requires a permit and you do not have one.

Insurance companies will not pay for damage under two general conditions: (1) you have violated the law or (2) circumstances could not be deemed accidental. A scenario in which some firecrackers in your home were set off when they were placed too near the barbecue would be accidental. If your teenager set a firecracker off on purpose, the certainty of coverage is far less clear and less likely.

If you were using fireworks legally, and did not intend to harm, your homeowners policy could pay under the personal liability section, which is property damage to third parties. There is no deductible applied to this coverage. If the at-fault homeowner has a personal umbrella, there may be coverage for the damage even if the underlying policy won't cover it. Again, this all depends on the policy language.

This type of claim could cause you to lose your insurance coverage at renewal time, depending on the severity of the loss and the degree of negligence that was demonstrated. A really expensive loss combined with blatantly reckless, deliberate behavior could create conditions for termination and/or non-renewal. At the very least, the carrier could issue an exclusion denying coverage to any future similar events.

But what if you are a renter and don't have homeowners insurance or renters insurance (which PIIAI strongly recommends you purchase for your protection)? Will your neighbors' insurance pay for any damage to their property? Possibly, dependent on the kind of homeowners' coverage they have. If paid, it would fall under the property damage portions of the policy, and would be subject to a deductible. But the insurance company making the payment to the not-at-fault homeowner would still subrogate the at-fault parties for the damage. This could include responsibility for the cost of having the municipality put out a fire or other related expenses, and the damaged party could sue for the amount of the deductible.

If your insurance company decides to pay for your fireworks-related claim, will your premiums go up? Generally speaking, the answer is no. The company will probably either cancel/non-renew the policy or attach an exclusion for all future losses from this particular risk. Losses like this are rare, so they are not experience-related as with car insurance.

In general, the homeowners' responsibilities include maintaining a safe environment in their home. The kinds of things that will be considered by the company evaluating a claim are the nature of the fireworks being used compared to the age, maturity and experience of the users; physical and pyrotechnic safety precautions that were taken; the physical surroundings of where they were used; and weather conditions.

If you drove to a field with good vertical and horizontal clearance, observed common sense safety rules, set off the fireworks in good weather conditions, but still caused some damage, your insurance will most likely cover the costs. You are still encouraged to stay away from do-it-yourself fireworks shows. For your safety, and for the safety of friends and family, it's best to avoid the risk.

The only way to be sure you're covered is to call your independent insurance agent before using fireworks. He or she will want to know your safety plan for using the fireworks. Even then, these kinds of homeowners claims are borderline at best because they constitute acts that materially increase the potential hazards of the insureds. Homeowners policies generally state that it is the insured's responsibility to never knowingly increase the hazard to loss.

Fireworks-Related Injuries

According to the U.S. Consumer Product Safety Commission, fireworks accounted for approximately 11,000 fireworks-related injuries treated in U.S. hospital emergency rooms in 2000. This number is up from the 8,500 fireworks-related injuries in 1999, most likely due to millennium celebrations as there were 1,000 more injuries in Jan. 2000 than in 1999. An estimated 6,600 of the 11,000 injuries in 2000 were during the one-month period surrounding the Fourth of July. These figures do not reflect those treated in non-emergency room setting or those left untreated.

Other statistics:
o The highest injury estimates were for firecrackers (1,600), rockets (1,300) and sparklers (1,200).
o Almost 50 percent of the injuries were to children under age 15.
o The number of injuries to males was approximately twice the number of injuries to females.
o The parts of the body most often injured were the hands, eyes, and head/face.
o More than half of the injuries involved burns.
o Injuries to the eye were primarily contusions, lacerations, and foreign bodies.
o During a special study period from June 23, 2000 to July 23, 2000, in-depth investigations showed that serious injuries were associated with: 1) fireworks explosions that were earlier or later than expected by the user, 2) rockets with errant flight paths, or 3) inappropriate use of fireworks by children.
To guard against these injuries, the PIIAI offers the following Fourth of July safety tips:

1. Make sure an adult is present and in charge at all times.
2. Wear safety goggles when lighting fireworks.
3. Purchase legal fireworks from a reliable seller.
4. Be sure to have water on hand for emergency use.
5. Do not attempt to light off more than one firework at a time.
6. Always read and follow label instructions.
7. Never pick up or re-light a firework that appears to be a dud.
8. Never throw or point fireworks at people, vehicles, buildings, etc.
9. Do not light fireworks in glass or metal containers.
10. Dispose of used fireworks by soaking them in water before putting them in the trash.