“If you’re driving out on the lake and your vehicle falls through the ice, will your insurance company provide coverage?” Earlier this week I posed this poll question to other local business people at a networking meeting. When I asked for a show of hands of how many people thought yes, not a single hand went up. Most thought the answer was no, and a few said they weren’t sure. Guess what? I’d say these undecided folks were probably the most correct.
You are probably covered…
I’m not sure how this started, but this legend has been floating around for years that insurance policies don’t cover vehicles that fall through the ice. I suppose this legend is beneficial in encouraging people to be more safety conscious, but I’ve never seen an insurance policy with an ice exclusion.
If you fully insure your vehicle, one of the coverages you purchase is Comprehensive. In a standard Auto policy, Comprehensive covers “direct and accidental loss to your covered auto” not caused by collision or upset. This is what we call open peril coverage; the loss is covered unless the insurance company can point to an exclusion. And there is no ice exclusion in a standard policy.*
Let’s not forget that if your vehicle fell through the ice, the loss of its value wouldn’t be your only concern. You would also be legally required to pull it out from the bottom of the lake. Unless you are well equipped with diving gear, special tow ropes, a customized crane and/or other necessary equipment (trust me, you’re not), you’re going to have to pay a specialist to get it out for you. And that won’t be cheap.
Based on some online research I did, recovering a car or pickup from a frozen lake may cost any where from $1500 to $5000 or even more. And make no mistake; the DNR isn’t going to let you just abandon your automobile at the bottom of the lake.
Interestingly enough, most Auto insurance policies really don’t indicate if coverage applies for recovery costs – whether this means a simple tow after an accident or a lake bottom extraction. However, the general consensus in the insurance industry seems to be that if a vehicle is fully insured, your insurance company is responsible for the cost to remove it from the scene if required by law, in addition to paying for its value or repair.
You might not be covered…
But hold on. What if your vehicle was not fully insured? Let’s say you use your old 1996 Chevy Pickup to pull your fish house onto the ice each winter. You don’t fully insure it, because if something happened to it, you’d come up with another grand to replace it with a new old bucket of rust. However this probably doesn’t mean that you ready to shell out thousands of dollars to pull it up and out of a lake if it falls through.
So here’s the question: if you carry “Liability only” on your vehicle, will your policy cover your legal obligation to remove the vehicle from the lake bottom after it falls through the ice? One could argue that because you are “liable” for the cost of removal, your Auto Liability coverage should apply.
But let’s take a closer look at your policy language. Your Auto insurance protects your liability for two things - bodily injury and property damage. Meaning that if a third party has suffered property damage for which you are responsible, your Auto policy will cover you. But the question is whether anyone else has suffered any property damage. Has the lake been “damaged” because there is a truck or car sitting on its bottom? (How about this: If you abandon an old broken-down car in your neighbor’s woods, have you “damaged” their property?) I think I could make reasonably sound arguments either way.
If you find this question confusing, you’re not alone; the insurance carriers seem confused as well. Recently, I contacted several of the carriers I represent asking them if they’d pay to recover a “Liability only” vehicle from the bottom of the lake. One carrier I talked to said yes. Others said no, and still others didn’t seem to be quite sure. So while we could hope for the best, I certainly wouldn’t count on coverage applying in this situation.
You’re probably not covered!
Now, it’s time to consider the other types of vehicles that people drive out on the ice – namely snowmobiles and four wheelers. The reality is that many people don’t insure these machines at all. This would leave you on your own to pay the four-figure bill to extract your off road vehicle after it falls through the ice. If you are going to be riding your ATV or sled out on a lake, make sure you have insurance to cover it, preferably an off road vehicle policy.
How about your fish house that you pull out on the ice? If you have it insured, we would expect coverage to work the same way as on your car or truck. However, what if your ice house isn’t worth that much and you didn’t worry about insuring it? Big mistake; you are probably on your own if it falls through.
Guess when I’ll fall through!
A couple years ago in the late winter I was driving east on Highway 2 crossing over the Pike Bay inlet at Cass Lake and noticed a vehicle parked out on the ice with a handmade sign in the windshield that said “Guess When I’ll Fall Through the Ice!” I’m sure that many passing drivers got a kick out of seeing it. (I’m equally confident that any passing DNR official didn’t get the joke!) This raises the point that there are other exclusions in your Auto policy that could apply to falling through the ice, such as that unhappy but always-present exclusion for intentional loss. Insurance policies contain other exclusions as well; so it’s very important to read your policy carefully.
My advice to you when driving out on the ice: First, use caution. Be very careful about where you drive. Bundle up and drive with your windows open to be safe. Be prepared in case the worst happens. And you are probably best to only bring out vehicles and trailers that are fully insured. Just in case.
*Because not all policies are standard, it is important that you read your policy carefully. While we have never seen an ice exclusion, we cannot say that there are no policies that add this restriction. In addition, it seems unlikely but possible to us that an insurance carrier might consider falling through the ice to be a collision or upset. If this were the case, Collision coverage might be necessary to cover the loss.
While this post pertains specifically to the risk of falling through the ice, Pine Country Insurance recommends that all off-road vehicles be properly insured, whether used on frozen lakes or just on land.
Ken Cobb is owner of Pine Country Insurance and has been active in the insurance industry for over 15 years. Meet Ken.
Coverage descriptions found in this blog are summaries provided for general educational purposes and cannot fully detail the terms, conditions, limitations or exclusions of a specific insurance policy. Please read your policy carefully.