Two Insurers to Help Cover Some Crumbling Foundation Costs

Two insurance companies have agreed to provide a total of $10.5 million to help Connecticut homeowners cover the cost of repairing and replacing crumbling foundations, officials said Tuesday.

The state has reached separate agreements with The Hartford and Liberty Mutual Insurance to financially assist current and former policyholders who file claims and receive grants through the state’s new Connecticut Foundation Solutions Indemnity Co., announced Gov. Dannel P. Malloy and Attorney General George Jepsen, both Democrats.

The Hartford has agreed to commit $3.5 million while Liberty Mutual Insurance will provide $7 million. Last month, Malloy and Jepsen announced Hartford-based Travelers Companies Inc. entered a similar memorandum of understanding with the state to provide $5 million to help affected current or past Travelers policyholders.

Jepsen said the money committed by the insurers will help homeowners bridge the gap between what they receive from the indemnity company and the cost of replacing their home’s foundation.

“The crumbling foundation crisis is a widespread and complex problem that requires all stakeholders to be part of the solution,” said Malloy, who leaves office Wednesday. It will be Jepsen’s last day, as well.

Malloy said the commitments from The Hartford and Liberty Mutual Insurance represent “significant progress” for the estimated thousands of homeowners in eastern and central Connecticut whose foundations have been deteriorating due to the presence of pyrrhotite in the concrete aggregate. The iron sulfide has reacted naturally over time with oxygen and water.

Michelle Loxton, a spokeswoman for The Hartford, said that most homeowners policies don’t cover these damages, but that the insurer recognizes “the highly unusual nature of this issue and the impact it is having on the families in Connecticut.” She said the insurer will continue to advocate for a “holistic and comprehensive solution to this crisis” that involves both federal and state resources.