How insurance will treat my slab water leak?

Question

Hi

I bought a fixer upper duplex a few weeks ago to keep it as a rental property. I have started slab foundation repair, which has resulted damages to sewer and fresh water pipelines.

Sewer line is visibly cracked somewhere, but leaks could possibly exist in other spots in the slab.

Fresh water line is visibly gushing under slab, definitely as a result of lifting the house.

I also have “Water Back Up and Sump Discharge or Overflow” coverage, but not sure that is relevant.

Do you think the dwelling coverage of my home insurance will cover it?

I know that they will have their own interpretation of the situation, but should I push the insurance to consider the slab being damaged by sewer water over years (I’ve had it only for a few weeks), or should I ask them to cover me because the foundation repair has caused the sewer line damage, as well as fresh water line damage.

Thank you.

Joe Splitrock · Answer

You can call your agent. Tell them you are not placing a claim and that you just want to discuss coverage. Explain the situation. I would be shocked if this is covered. Either the contractor is responsible or it would just be considered age related foundation damage.

Jason Bott · Answer

@Mazyar A. sorry your running into this issue. A few comment,

*If you are using an insured contractor, you could try and file a claim under their General Liability policy, but it sounds like you are doing the wok yourself?

*Water Sewer back up would not respond in this case.

*Intentional Acts are excluded on all insurance policies. I believe any claim adjuster would go to that Exclusion first. They would state "You intentionally lifted the property which cased the damage to the pipes, therefore it's not covered".

*If you purchased a Builders Risk policy, maybe your would have some coverage

Lastly, you only will know for sure if you formally file the claim. Best of luck with it.

Mazyar A. · Answer

Justin,

Both of any of the following scenarios could have happened:

1- There was a long term leak under the slab (either clean water or sewer leak, or both) that have cause the foundation to settle, and thus cause even more damage to the rest of the pipe lines.

2- The settlement of the foundation due to non-leak reasons (such as bad soil mechanics) might have caused the pipes to break or crack.

3- Lifting the foundation causing the pipes crack.

4- Combination of all above

I have had this property for a few weeks, so it has been out of my control.

The lowest quotes I have got for fully replacing the sewer line and clean water line is about $13.5K for a 1800 SF house.

My deductible is about $2500 if the insurance would cover it. But that is the question.

Justin V. · Answer

@Mazyar A.

How much damage or how much for the plumbing fix?

Is it worth getting insurance involved?

Did the breaks go unnoticed for a bit?

Mazyar A. · Answer

Thank you Joe. I will do so if I cannot find a common ground with the contractor.

Mazyar A. · Answer

It is on my personal name, but I have specified the type of property as a rental property, not a primary house. Is it considered still personal?

Thank you.

Jason Bott · Answer

@Mazyar A. if you are insured with a personal lines policy, then they could count the claim inquiry against you and list it on your CLUE report.

If you have a commercial policy, it will not count against you unless something is paid out.

Mazyar A. · Answer

Jason,

Thank you for your reply. In my contract with the foundation repair company, they are not reliable for issues that rise for sewer lines, but the contract does not say so for clean water line. I will discuss it further with the contractor to try to see if his insurance will cover.

If I call my own insurance and discuss this, but not formally file a claim, would they still take and note that conversation as a claim? I know that some auto insurance company do that.

Thanks.

How insurance will treat my slab water leak?

How insurance will treat my slab water leak?

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