Many of you might have either read or heard about the massive gas leak that affected thousands of residents of Porter Ranch, a suburb of Los Angeles. The gas leak emanating from a nearby underground gas storage facility (operated by the Southern California Gas Co.) purportedly has stopped after a fix, but not before causing an estimated 100,000 tons of methane to be emitted into the atmosphere. Many scientists are calling the Porter Ranch gas leak the biggest in U.S. history.

The many homeowners and their families impacted by the gas leak and had to temporarily relocate because the smell was inducing illness, are now beginning to slowly return to their homes. For those who suffered ill health effects from the leak, some are suing the gas company for compensation.

But what about any impact the gas leak may have had on the home or property itself? Is there anything that might be covered under a homeowner policy? There are a number of considerations. First, is there actual physical damage to the property from the gas? Since virtually all policies require a direct physical loss, unless the gas has physically altered the property in some way to make it unfit for use or necessitating repair then there is no coverage.1

Second, even if there is physical damage caused by the gas, is there an exclusion in the policy that would exclude the claim? Most homeowner policies have a pollution exclusion clause that would enable the insurance company to deny coverage. Pollutants, as defined in most policies, include gases, vapors and fumes dispersed or discharged into the air. The methane released by the Porter Ranch gas leak would most likely be considered a pollutant and therefore the pollution exclusion would apply.

So, homeowners affected by the gas leak may want to think carefully about whether they want to make an insurance claim. In all likelihood, any damage caused by the gas leak would not be covered. Nonetheless, it would still be prudent to consult with an insurance professional because although very similar, not every homeowner policy is identical.

1 Some states have a very broad interpretation of "physical loss" which includes non-tangible changes to the property such as pervasive odor or smell.