Insurance Claim | Arson Covered? - Posted by J-BC

Posted by Jimmy on May 18, 2006 at 14:02:56:

the vacancy issue is real, and can kill yoru recovery. a standard policy will not cover a unit that stays vacant for more than 30 days. its in almost every policy. [and makes sense. a vacant unit is a lot more likely to be vandalized or damaged].

I frequently buy vacancy policies to cover properties I am rehabbing. they are more expensive, but not ridiculously so.

Insurance Claim | Arson Covered? - Posted by J-BC

Posted by J-BC on May 15, 2006 at 14:36:28:

I have a property with two units, they are on the same legal lot (think detached duplex) The property is insured under a blanket policy and there is no separate mention of the unit/house.

The small unit’s tenant has just moved out a month ago. Now last friday there was a fire in the unit. The tenant is a suspect, pending fire report and police report. However insurance doesn’t want to pay. (are we surprised?) Insurance ajuster doesn’t think arson is covered because “Arson is now considered vandalism, and vandalism is not covered when the property is vacant.” However the property is covered as a whole and there has never been a vacancy in the house. So now the $10,000.00 question; was the property vacant when the unit was?

Last bit of fun; the ajuster asked tons of leading questions and then gave me my “statement” to sign. It was a little self damaging and largly irelevant to say the least, I was “not sure who the tenant was” “grateful that the damage was so slight” ect etc. He gave me the original though (to show to my attourny) and has no other copies. it just might dissapear… My question is why do I need to make a statement? Is it ok to refuse or write something that is more to the point and less pro-insurer

What are my options?
Posted in | Legal | General |

Re: Insurance Claim | Arson Covered? - Posted by ken

Posted by ken on May 15, 2006 at 17:02:49:

You need to get a public adjuster. They fight for you and get a percentage of what is paid.They are well worth it.Remember the insurance company is responsible to share holders not to you

Re: Insurance Claim | Arson Covered? - Posted by J-BC

Posted by J-BC on May 15, 2006 at 23:14:03:

Thanks Ken that is a great idea, I can really see who is signing the mans pay check here.


YES. - Posted by Jimmy

Posted by Jimmy on May 16, 2006 at 07:26:14:

The adjuster is jerking you around, perhaps trying to satisfy himself that you were not involved in the fire.

You do not need a public adjuster yet. They will take a chunk of your recovery, which may be unnecessary. If the IC refuses to pay, or makes a settlement offer that does not satisfy you, THEN hire a public adjuster. and make sure your deal with the PA is a fraction of the incremental recovery (and not the part you could have had anyway).

I have had two arson fires. The initial inquiry by both the fire marshall and the IC was to make sure I was not involved. Once that is determined, the insurance pays. Arson is absolutely covered.

The next time the IC guy tells you arson may not be covered, use these magic words: “Do you know what BAD FAITH means???” [when an IC refuses to settle up, and does so arbitrarily and wrongly, it can be considered bad faith, and it multiplies the recovery. like punitive damages.]

Re: YES. - Posted by J-BC

Posted by J-BC on May 17, 2006 at 12:25:37:

Thanks Jimmy,

I was talking to a Lawyer yesterday about this and he said something along those lines. He had some really choice things to say about insurance ajusters in general…

They are now trying to get out on the vacancy clause because the unit was empty (it is a guest house on the same property as a house) Although the insurance policy provides blanket coverage for both units as one property. Leading to the fact that the property has never been empty.

Thanks again,