Copper thefts cause spike in home insurance claims

Gina Roberts-Grey and Aaron Crowe

To some thieves, copper is practically worth its weight in gold. From January 2009 through December 2011, all but 4 percent of the insurance claims filed in metal theft cases involved stolen copper, according to the nonprofit National Insurance Crime Bureau, which investigates suspicious claims.

Businesses filed 55 percent of the more than 25,000 claims. But homeowners and other holders of personal insurance policies accounted for the remaining 45 percent. These days, it seems that no one can escape the threat of metal theft, as prices for copper remain high, driven by demand from countries like China and India. Prime targets for copper theft include air-conditioning units and water pipes.

Criminals easily can score $100 by selling copper from a large air conditioner to recyclers and scrap yards. In recent months, the market price for a pound of copper has been hovering around $3.30 to $4.

"As the price for copper rises, the thefts trend up and vice versa," says Frank Scafidi, a spokesman for the National Insurance Crime Bureau.

Are copper crimes covered?

So, what does this mean for homeowners whose air conditioners and pipes contain copper? Well, copper theft could cost you a pretty penny.

Kurt Dettmer, vice president of marketing at Michigan-based Fremont Insurance, said in a 2011 news release: "Often, the value of common copper items may be overlooked by the consumer, but as the price goes up, thieves see an opportunity to make some quick cash and they aren't afraid to cause significant collateral damage to your property to do it."

A typical homeowner's insurance or business insurance policy covers the theft of copper and other metals, such as bronze, brass and aluminum. However, your policy may dictate that such a theft isn't covered, Scafidi warns.

In a report on metal theft claims, the crime bureau says the damage caused by such thefts frequently "is several times the value of the metal stolen, leaving the victims with hefty repair costs which are often passed on to insurance companies."

If an AC unit isn't stolen by copper criminals, it sometimes can be repaired. But if it can't be fixed, an insurer will pay for it to be replaced under a theft claim, says Mike Coleman, a State Farm agent in Alabama.

On the insurer's website, Nationwide agent Ron Keats, president of The Keats Agency in New York, says: "Vacant buildings and homes under construction are huge targets for copper) thieves. The contractor locks the door, walks away and thinks it's safe. But it's not."

Even if a copper thief does strike at your home, you should think twice about submitting an insurance claim. For one thing, you'll have to pay your deductible first before you get any cash from your insurer. Secondly, if you've filed too many home insurance claims in the past five years -- perhaps two or more -- your rates may rise or you may be dropped as a customer.

Metal fatigue

Ohio topped the crime bureau's most recent list of the top states for insurance claims related to metal theft -- nearly 2,400 from January 2009 through December 2011. Texas came in second, followed by Georgia, California and Illinois.

Rhode Island led the pack when it came to the number of metal theft claims per 10,000 residents 2.59). Next in line were Ohio, Delaware, Kentucky and Georgia.

Whatever state you're in, Fremont Insurance and Hartford Steam Boiler offer these tips for curbing the theft of copper:

  • Install motion-sensor lights and an audible alarm around your property. For about $300, alarms are available that can monitor refrigerant pressure in an air conditioner and alert an owner when lines are cut or leak. A similar alarm is available that activates a siren when someone's trying to move an outdoors AC unit.
  • Equip your AC unit with a wireless GPS device designed to track the equipment if it's stolen.
  • Put up a fence around an on-the-ground AC unit.Spray-paint copper lines with a bright color. Thieves will see the lines as marked and traceable, and will be less likely to steal the metal. Metal recyclers often question marked metal.

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