Flood damage entitlement

7 Replies

Hi BP members:

      I was wondering if anyone in Chicago has had this experience. About a month ago we had some heavy rains in the west Chicago area. As a result there was some seepage in the basement of my rental house and now the tenant is claiming $3,000.00 worth of damages. In the rent lease under the section headed basement it states that the basement should not be used as a bedroom and that its susceptible to seepage in heavy rains so that anything stored in the basement should be elevated. These tenants moved in about 3 months ago and now this. We had discussed this when they inspected the house.  Many of the houses in the area had inches of flooding in the basement. Are they entitled to recovery ?.

have them file a claim with their renter's insurance.

if they don't have it then they're likely out of luck.

Very unlikely renters insurance would cover this type of damage.  Nor would homeowners or landlord insurance.  The only type of insurance that covers this sort of damage (water hits ground then comes into your property) is flood insurance.

Given the verbiage in your lease I doubt they would prevail in court.  Point out the section of your lease and remind them about the discussion you had at lease signing.

Basement space seems useful.  But it has this water issue.  That's why its worth so little when valuing a property.

This would be a renter's insurance claim, if they don't have it that is their problem.  

Thank you Max and Jon, I kinda caved in and offered a $200 discount for a year then the rent goes back to $1500 a month. I will emphasize that they get renters insurance or take the risk and I will  make the wording stronger about seepage and flooding of the basement .  The reality is I cant afford another vacancy at this time or I would take a stronger stand but for the next couple months the taxes are covered and am not paying additional heat in the winter.  Brie thank you see you at your next meeting .

Frank,

Your tenant would have to get their own insurance for the damage to their contents.  A tenants policy will not cover the damage due to ground water seeping in.  A flood policy is a possible solution but it has restrictions on what is covered in a basement and what constitutes a flood.  The tenant should contact an Independent agent and discuss their needs. 

**if there is a sump pump, suggest to them that they discuss "Back up of Sewers & Drains" coverage with the agent.  It will not cover the seepage but it may provide coverage in certain situations where the pump gets damaged or fails.   You may also want to discuss that coverage with your agent.

Hi Scott am i a tight financial position so at this point its a good plan. Good idea John will work all this into my lease. Seepage is not uncommon in Chicago house basements. Appreciate it.

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.

Lock We hate spam just as much as you

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.