I wanted to share my experience with my first property fire, which shockingly was not a terrible process to navigate through. A little background on the property, we had just purchased a 4-plex off market. Two of the units were recently remodeled, the other two units were in rough shape with less than desirable tenants. One of these tenants, nicknamed cat lady, owned 12 cats in a 2 bed 1 bath unit. This is the first time I’ve had a home inspection actually list “cats” as an area of concern during the inspection. After purchasing the property, we began renovations on one of the remaining units needing remodeled and decided to honor the last 3 months on cat lady's lease.
The night of February 20th, I woke up around 3:00 AM and saw I had a missed call from one of my property managers. I immediately knew something was wrong for him to be calling that late. His voicemail went something like this: “Matt give me a call, we had a fire in unit 3 and it looks to have spread to the other units. The fire department is still trying to put the fire out. No one was home at the time. It’s bad.” My heart sank when I received that voicemail. After pacing around the house for 20 minutes I called insurance. I knew very little information at the time so I was only able to give the insurance representative some very basic info. The big takeaway from the initial call was to secure the property once the fire department left. We were allocated what they called “emergency funds” to purchase items such as doors or plywood to secure the property. They wanted me to keep any receipts and my designated representative for this process would reach out to me the next business day.
The following Monday the insurance rep that would guide me through this process reached out to me. I gave him my property manager's contact information to help coordinate future meetings at the property. The main message during the conversation was to once again make sure the property was secure. They didn't want the tenant removing anything. Insurance was treating it like a crime scene. We scheduled a time for him and the local fire inspector to come out and tour the property to start determining the cause. The two of them, along with my property manager, met and discussed what the fire department suspected happened. The fire had originated from unit three, which of course was a remodeled unit, and spread to unit one above it. The other two units fortunately only had smoke damage. There was no exterior damage. While this meeting was very stressful for me, one funny thing that came from it was the firefighter’s story about breaking into cat lady’s unit and 12 cats running out the door. They were only able to catch three and were worried they wouldn’t come back. Good or bad, all 12 cats came home a few days later.
After my insurance rep met with the local fire inspector, insurance scheduled their own fire inspector to come out to the property and rebuild the scene. They spent hours going through the unit and confiscated the oven which I thought was strange. This occurred about 2 weeks after the initial fire. A couple days later, I was contacted by another insurance representative who explained she would be communicating on my behalf with the tenant's insurance. It had been determined that the tenant was at fault. The tenant was arguing otherwise. Insurance had confiscated the oven because they had determined a specific burner had been left on with a pot of oil on it. The fire department's investigation supported the theory of an oil fire. The representative claimed that they would be going after her insurance to reimburse my deductible. This is still ongoing.
On March 22nd, one month after the fire, I received a line-by-line quote from insurance to repair the fire damage and 6 month's worth of rent for the displaced tenants. I sent the quote to my contractor, who was already on site working on one of the other units being remodeled, and he confirmed that he could fix the fire damage for the quoted amount. Insurance was very open to negotiating the terms of the quote. About a week later, I received two checks from insurance. One for the repairs and one for the six months of rent for the displaced tenants. To this day, we have fixed two of the smoked damaged units and the fire damaged unit is almost completely remodeled.
I was terrified when I received the initial call that a fire had broken out in one of our 4-plexes, but the process was surprisingly smooth and not a bad experience at all. The combination of insurance, the local fire department, and my property manager made this a very easy process to go through, a process where I could have been completely hands off if I had chosen too.
