Insurance Reimbursement for Frozen Pipe
Hello,
I own an upper/lower duplex in Milwaukee, WI. I live (well lived) in the lower unit, and rented out the upper unit. BecauseI lived in the home I had a homeowners insurance policy (not a landlord policy). On Christmas a pipe upstairs froze causing water damage to the upper unit floors, and damage to much of the lower unit (that I lived in) ceilings, walls, floors, etc.
Where it gets tricky. I planned on moving out of the lower unit 02/15 (and did so) and planned on renting out that lower unit like the day I moved out. I did not have a lease or anything set in place before the pipe burst on Christmas. I moved to North Carolina on 2/15. The water mitigation team came out immediately after the pipe burst and did there thing, then the reconstruction team got their estimate out to my All State Insurance on 01/16/2023. I was prepared to just bite a month or two of lost revenue on it, but it is now 03/09/2023 and insurance has STILL NOT EVEN approved the estimate (after a ton of follow ups by me and the reconstruction team). So I am now losing and will continue to lose multiple months of rental income on this (reconstruction may take several months). I seem to be in a hard place though because it's a homeowners insurance policy and they claim to not be paying for lost revenue even though I am moved out and it's sitting vacant.
Can anyone share some advice on: Is there any way insurance should be paying for the lost rental income? Can the fact that they have been extremely slow in the process be used? I'd like to claim I still live there in order to get some temporary housing (which I would actually use since I travel back and forth to there), is this a viable option?
Thank so much in advance for any insight!
#2 Insurance Contributor
- Insurance Agent
- Nationwide
@Jim Panek for the Loss of Rents to be paid out, you would need to show an in force lease at the time of the loss. In your case, you would have Loss of Rents on the Upper given that is the unit where you had a lease in place.
The loss of use as a Homeowner would be the only viable option. You would have to provide the receipts for the expenses you incurred to live somewhere else.
Let me know if you have any other questions on it. Good Luck.
@Jason Bott Thank you for the response Jason!
If the upstairs unit moves out (note he does not have renters insurance), would the lost rent there be eligible for reimbursement?
Do you know for your second point "Loss of use as a homeowner", can my new rent here in North Carolina be used as an incurred expense to live somewhere else?
Thanks again!
#2 Insurance Contributor
- Insurance Agent
- Nationwide
Quote from @Jim Panek:
@Jason Bott Thank you for the response Jason!
If the upstairs unit moves out (note he does not have renters insurance), would the lost rent there be eligible for reimbursement?
Do you know for your second point "Loss of use as a homeowner", can my new rent here in North Carolina be used as an incurred expense to live somewhere else?
Thanks again!
Jim, on your first point, a covered Peril (Fire, Wind, etc) needs to trigger an insurance policy for coverage to be provided. A tenant moving out is not a covered Peril.
As for the 2nd point, only the claim rep would be able to make that determination.