Real Estate Broker · LA & ORANGE COUNTY CA -Multi Family · Member since 2016 · 374 posts · 132 votes
My neighbors home is rented out and it caught fire by fault if the tenants and because of it it burned our fence. We filed a claim with our insurance and provided all of the proof and documents they requested. So our insurance covered the expense for the new fence. But now the landlords insurance is stating it is not the landlords fault and it’s the tenants fault so we can’t go after the landlord. The landlord doesn’t have renters insurance. I don’t find this to be just. Because now our insurance is going to go up. It’s not fair and I think the landlord should be held liable.
any advice on how to go about taking care of this? is this legal? Any help I would appreciate thanks
Before you decide to do anything, call the adjuster who handled your claim and ask if the claim will be going to "Subrogation". If they plan on subrogating (your insurance company goes after another insurance company). If so, they will be doing the work for you. If they recover anything they may also reimburse you for part of your deductible.
No landlord has “renters insurance” that’s why it’s called “renter’s insurance”.
Like you said, it’s not fair to hold the landlord responsible for something the tenant did. What if the tenant drove their car in to your fence, you wouldn’t expect the landlord to pay for that either.
Certainly you can sue the tenant, but you’ll only be doing that if you’re with the worst insurance company in the world. That’s literally their job. Maybe they’d rather just jack your rates up, but they’re making that call.
Meanwhile: if you haven’t been required to pay the deductible out of pocket they have either gotten that money from someone else already or they are treating the loss like they do a shopping cart hitting your car in the parking lot, not your fault.
Before you decide to do anything, call the adjuster who handled your claim and ask if the claim will be going to "Subrogation". If they plan on subrogating (your insurance company goes after another insurance company). If so, they will be doing the work for you. If they recover anything they may also reimburse you for part of your deductible.
Sorry for the issues. I know claims can be difficult to manage and understand at times.
I know it's too late now, but it may have been best to wait a little while to see if the tenants liability insurance could have been triggered due to "potential" negligence, or simply because the tenant let their insurance carrier know that their fire caused your property to be damaged. Unfortunately, if their carrier were to deny helping you, the burden to prove the tenant's negligence would be up to you to prove (likely in court/mediation).
Just keep in mind that if the fire wasn't due to negligence, but was because a wire shorted out in a light switch, plug, in the wall, in an appliance, etc., then you're going to be hard pressed to get their insurance carrier to reimburse you anyway. There's no negligence in these situations 99.9% of the time. As you can imagine, even a prudent person doesn't / can't survey the internal components of their switches, plugs, wiring in the walls, wiring in appliances, etc. If this was the case, then it's simply an extremely unfortunate situation, and both parties will have to file claims and allow their insurance carriers to respond.
The other unfortunate truth is that the claim is likely too small for your insurance carrier to subrogate against the tenants liability coverage. Most carriers weigh the cost of the legal fees that go into subrogation, and quickly determine whether it's worth the cost/effort or not. If the payout for your fence is minimal (in your carrier's eyes), then I would guess that your carrier isn't going to subrogate, which means the loss and claim stays with you and hits your loss history record.
Lastly, if you haven't had any (or many) claims in the past 3 years, and the payout of this claim is minimal to the carrier, then I wouldn't imagine your premium would be influenced too much due to this loss. In fact, I think the insurance industry, tough economy, and a hardening insurance market would likely have more impact on your premiums in CA, than this loss. I've recently seen folks in CA receive renewal quotes with 20% + increases in premium and they haven't had any claims at all. They incurred these increases simply due to market conditions.
I would suggest you visit with your agent about how they think this loss might influence your renewal premium versus the influence of a hardening insurance market. If you don't like the response, look to shop your insurance with another agent and/or other carriers. The best news is that CA (west coast states) typically have some of the most aggressive rates when compared to the rest of the country. So while it may seem awful that your rates jump from .10 cents to .15 cents, at least your not paying .40+ cents (on average) like folks in the central and eastern U.S.
I hope you find this information helpful. Good luck!
