Home owner insurance battle

7 Replies

This might be off the topic, but I am running out of ideas now. Except the problems with my investment property, now I am running into a even bigger issue with my own property currently reside. This summer, we have drain flies out of control, the little bugs were everywhere in our house. we called professionals came in, said it was sewer pipes leaking, created a huge nest under my house for them to live in. Our bigger issue is that the leaking water separate my house's slabs and soil underneath it, a huge cavity was formed under my house. To fix it, we need to break the concrete of our drive way, garage, maybe even more which will cost a lot of money.  We talked to our home owner insurance, state farm, hoping they will cover that. But we got verbally message from them said it was a pre-exisiting condition and they won't pay for that. I talked to several attorneys who told me since e haven't file any claim yet,  there is nothing they can do. Even if we file claims, they are not sure if will take the case. I need some help and guides helping me through this ordeals. Thank you!

All I can tell ya is to read your agreement with your insurance company and make sure they cover something like this, then file a claim. If they officially decline the claim, run it by an attorney, get a price from the attorney and decide if it's worth your trouble.

@Ashley Zhang, sounds terrible. Really sorry you’re deal with that.

You can always file a claim on your insurance policy. If your local State Farm agent resists, call the State Farm claim number directly (just google it). Then a company adjuster will look at your policy and decide if what happened is covered.  Could filing a claim have a negative effect on price even if it doesn't pay out?  Unfortunately, yes.  At the same time, filing a claim is the only way you can truly hear the company's assessment of the scenario.

Based on what you've said, standard insurance policies may not include coverage.  The insurance adjuster is going to look at the source of the damage and compare that to what your policy covers.  The possibilities seem to be: sewer leak, flies, water erosion. Let's address each separately:

SEWER LINE LEAK:

If you have "Service Line Coverage" or "Utility Line Coverage" that would likely apply to this scenario.  If you have "Water Back Up Coverage" that may apply as well.  If you don't have either it's hard to see where a standard policy would address this.

FLIES:

Standard policies have an exclusion for damage caused by, "birds, vermin, rodents, or insects".  Thinking insects would be the deal here.  Having noted that exclusion, it doesn't seem like the damage was caused by insects.  They are a result of something else.

WATER EROSION:

Inside your home, say a toilet valve leaks.  The resulting water damage is often covered even though replacing the value that leaked is not.  I think there's an argument to be made that this is water damage as the result of a system failure.  The issue with this argument may be the fact that it's an external failure (it's not in your house).

Bottom Line: It may be worth filing and seeing where the insurance adjuster goes.  I can see a lot of ways this ends up not being covered but there are a few avenues, depending on your policy, where it could be.  If you have Service Line Coverage, definitely file the claim.

Hope this was helpful.  Feel free to reach out if you need more thoughts.

Before engaging with a lawyer I suggest contacting your state's Insruance Commissioner - businesses are always responsive to the regulators that allow them to operate.

Originally posted by @Allan Smith :

All I can tell ya is to read your agreement with your insurance company and make sure they cover something like this, then file a claim. If they officially decline the claim, run it by an attorney, get a price from the attorney and decide if it's worth your trouble.

Thanks Allan! I guess i will have to fix it no matter what and go from there. 

 

Originally posted by @Jeremy Goodrich :

@Ashley Zhang, sounds terrible. Really sorry you’re deal with that.

You can always file a claim on your insurance policy. If your local State Farm agent resists, call the State Farm claim number directly (just google it). Then a company adjuster will look at your policy and decide if what happened is covered.  Could filing a claim have a negative effect on price even if it doesn't pay out?  Unfortunately, yes.  At the same time, filing a claim is the only way you can truly hear the company's assessment of the scenario.

Based on what you've said, standard insurance policies may not include coverage.  The insurance adjuster is going to look at the source of the damage and compare that to what your policy covers.  The possibilities seem to be: sewer leak, flies, water erosion. Let's address each separately:

SEWER LINE LEAK:

If you have "Service Line Coverage" or "Utility Line Coverage" that would likely apply to this scenario.  If you have "Water Back Up Coverage" that may apply as well.  If you don't have either it's hard to see where a standard policy would address this.

FLIES:

Standard policies have an exclusion for damage caused by, "birds, vermin, rodents, or insects".  Thinking insects would be the deal here.  Having noted that exclusion, it doesn't seem like the damage was caused by insects.  They are a result of something else.

WATER EROSION:

Inside your home, say a toilet valve leaks.  The resulting water damage is often covered even though replacing the value that leaked is not.  I think there's an argument to be made that this is water damage as the result of a system failure.  The issue with this argument may be the fact that it's an external failure (it's not in your house).

Bottom Line: It may be worth filing and seeing where the insurance adjuster goes.  I can see a lot of ways this ends up not being covered but there are a few avenues, depending on your policy, where it could be.  If you have Service Line Coverage, definitely file the claim.

Hope this was helpful.  Feel free to reach out if you need more thoughts.

Hi Jeremy, thank you for your input! I am happy to hear from a insurance professional like you. I am fighting with the plumber now as well since they insists that it was caused by foundations, but foundation specialists said it's not. My headache is just getting worse everytime i contact them. 

 

Originally posted by @Joe Norman :

Before engaging with a lawyer I suggest contacting your state's Insruance Commissioner - businesses are always responsive to the regulators that allow them to operate.

I never heard about this. But i will look into it. Thank you Joe!

 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here