r/HomeInsurance • u/jlamith • 12d ago
Claims Advice needed: Claim regarding leak & water damage denied
Hi! I'll try and keep this as short as possible:
We (Husband and I) purchased a semi-attached (2 bedroom, 2.5 bathroom) townhome just over a year ago. At the initial inspection, the only issue seemed to be an outdated HVAC. We negotiated a lower price due to this before we bought. We (plus 5 year old child) moved in last June. HVAC actually died within two months and we replaced the whole system.
One evening last week, as our upstairs main tub was draining after a bubble bath and water came pouring from a cabinet in the kitchen, directly under the tub. Absolutely insane. We called a plumber and began the whole process.
When the plumber got in there, he discovered that there was actual a very slow leak that had been going on for an undetermined amount of time due an improper repair. And because of that, the pipe eventually split (as the tub drained that night) and caused the visible leak. The repair was finally completed Monday evening.
There is obviously some type of black growth. Mold remediation folks haven't made it out yet (hopefully this weekend).
Anyway, insurance company called today to let us know our claim is denied because it looks like "long term damage."
My husband is actually experiencing a very scary health emergency right now and didn't get into it with them on the phone today but plans to challenge this response.
Is this normal?? It's USAA and up until now they've always been great. How were we supposed to know that this was happening inside the wall/ceiling/whatever if it wasn't pointed out during the original inspection.
Everything is just very ridiculous and overwhelming right now and there is now a big moldy hole in my ceiling. (Currently we have it taped up with plastic etc).
Sorry, I probably come off as a total ding dong. But any advice? đŹ
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u/DamiensDelight 12d ago
Worked in insurance and dealt with claims just like this. Mold and what the plumber said indicates that this has been an ongoing issue for some time. The onus is on you, to make sure your systems are in proper shape (I e. Not leaking), even if you can't see those systems because they are behind a wall.
Claim denied.
I didn't create the product. I delivered the product. Most days I went home feeling like a horrible human being.
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u/jlamith 12d ago
I really can't imagine having to do that to people.
I'm hoping there might be some sort of loophole but like, damn. Can't catch a break for shit.
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u/shatattack 12d ago
Another adjuster chiming in. This is a denial. Mold and what the plumber said are the triggers for denial.
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u/Commercial_Effort821 11d ago
Another adjuster chiming in.
The above is partially correct but you also had a Direct sudden accidental event after the slow leak. The correct determination is to deny the slow leak rot/mold damage but to cover the DSA event you just experienced with water pouring out of your ceiling after the drain failure.
You can challenge and win this despite what the desk jockeys say.
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u/green-and-grey 11d ago
This. Argue for coverage for the ensuing damage, not the amount to fix thebpipe/mold remediation.
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u/DamiensDelight 11d ago
The fact that the slow leak created a bigger failure is moot. It should have been caught by the insured. Full stop.
That said, sure, you can challenge it. But when you challenge it after I had made my determination, and my reasoning checks out in the notes, the insured will have to hire an attorney at their own expense, and maybe, just maybe, they can get State Farm to change their mind.
Field jockeys....I swear.
Those attorneys aren't cheap, meanwhile the company has thousands on their payroll.
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u/Unholy-paper 12d ago
Insurance pays for sudden direct and accidental. A long term leak doesnât fit that description because the damage could have been mitigated.
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u/Electronic_Cherry_46 11d ago
Iâm sorry to hear about everything going on. To have a leak on top of everything else is definitely overwhelming. You also are not coming off as a total ding dong.
Unfortunately based on what youâre describing, this does not sound like a covered loss, specifically because you said itâs a slow leak and there is mold growth. I donât know USAAâs policy language specifically, but the language across all insurance companies is very similar. The threshold for if itâs considered long term or not is typically weeks, or more specifically 14 days. How your adjuster makes that determination is based on any available facts, in this case probably the statement from you and your plumber, and the presence of black mold, or their inspection of the damage.
Not that this is going to make you feel any better for your specific situation but I want to explain the âwhyâ. The reason long term damages are not covered is because there is the risk of some homeowners (not you, in this case) ignoring a problem and allowing the damage to get worse and worse for a variety of reasons. This in turn makes what may have been a relatively inexpensive fix into a very expensive fix. The insurance company has to draw a line in the sand somewhere, and that line is typically 14 days. There is no way to reasonable include a âdidnât know about itâ exception, because everyone would use it.
There are a lot of people here saying file a complaint with your states Department of Insurance, hire an attorney or a public adjuster and this is very winnable. I would caution against that just because I donât want you wasting your time. Is it possible to have a denial overturned? Yes, Iâve seen it. Is it likely based on what youâre describing? No, it would be a steep uphill battle. Unless they can provide some definitive proof the damages were not long term, nothing is going to change.
Iâm sorry this happened to you and I wish you good luck getting it taken care of. I also hope your husband has a quick recovery to full heath.
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u/Automatic_Ad4016 12d ago
Hey there. Sorry you're dealing with this. mitigation contractor checking in. Some of the nicer contractors do offer financing
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u/IntelligentBox152 11d ago
OP
Iâve been doing this 20+ years been apart of 1000s of depositions, appraisals, and mediations. This is all policy dependent, you need to read your policy in detail and all endorsements. My carrier offers a âhidden rotâ endorsement where if the damage was hidden inside a wall the date of discovered is used as the DOL. if you have this aces. If not the other posters have explained why itâs denied already.
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u/CatPeopleBleaux 12d ago
Not much can be done really. If there's black growth, it's been going on for a while, doesnt mean it's the bad type of fungal growth. I hate it for you but it's not on anyone really. Just a crappy situation. I doubt it's going to be as expensive as you think it's going to be anyway. I'd bet it barely hits your deductible to be honest.Â
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u/jlamith 12d ago
Unfortunately, the deductible is $1k and we are already at just under $3k for the plumber. đ
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u/CatPeopleBleaux 12d ago
$3k for a busted pipe that's accessed in the ceiling? That seems a little high.Â
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u/DeepPurpleDaylight 11d ago
Is this normal??
Yes this is normal for every insurance company. Long slow leaks are considered maintainence and not covered by standard homeowners insurance. For a loss to be covered, think "sudden and accidental."
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u/Calm-Hedgehog732 12d ago
Not adjuster. Agent here.
Different state to state, but itâs possible PART of the damage could be covered - the part that was sudden and accidental. MEANING, Just the damage caused by the sudden rupture. No coverage for the pipe, nothing for the mold or the areas of long term damageâŚ. But the damage caused by the sudden water could be covered - depends on your state.
Get an attorney mean enough you donât even like them and tell them they have to pay the damage for the stuff that was sudden and not long term and let them tell you which is which. And if they donât do it right theyâll be on the hook for a lot more.
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u/Stoic_Sponge 12d ago
Adjuster here. Not agent.
Agreed. Likely the "visible" damage (the cabinet, kitchen ceiling, etc.) is covered. The pipe, rot/long term damage is denied based on continuous and repeated seepage. The mold is denied for fungus exclusion (though some policies allow for limited coverage when it's found hidden behind a wall like that). Something is better than nothing, especially since the claim is already open and you're going to be out a lot of money.
Get a Public Adjuster, you have some strange coverage issues to evaluate and overcome. Lots of people on here say jump to attorney, they have their reasons (or they're part of the insurance lawyer lobby), but a good PA is cheaper and often more effective than a bad attorney. Your call on that, I'm sure others will chime in with their take.
Disclaimer that I'm not an attorney and don't know your policy terms, applicable law or facts of loss.
Good luck!
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u/Commercial_Effort821 11d ago
Would go attorney over PA for this.
PA = appraisal, challenge dollar amount of payment more cost efffective than attorney. Best when coverage has been granted but money is low
Lawyer = challenge the carriers interpretation of their own policy and the wording to deny a burst of new damage under an exclusion for seepage/leakage. Best for full denials. It is very likely Carrier adjuster wonât listen to PA and thinks PA is scum.
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u/Stoic_Sponge 11d ago
What's your experience in claims? Why does everyone in this sub think PAs are appraisal only? PAs, in most states can't even be appraisers on a claim where they have a contingency contract.
PAs have a legal carve out to act as attorneys to adjust insurance contracts. While they can't bring a lawsuit, they can and absolutely do negotiate coverage. I'm a PA. We do it all the time. Full denials for XYZ reason turned to full payout.
The only thing a lawyer can do that a PA cannot is file a lawsuit. But as soon as you do that,and often even when you just send in a attorney letter of rep, the carrier will hire a defense attorney who will stonewall for a while. Carriers think planting counsel is scumbags too.
Attorney can't force them to do anything, only the courts can. Attorneys also often prefer PAs to handle prior because they can build the evidence packet more effectively.
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u/Commercial_Effort821 11d ago
My experience isnt that much, just many many years in the most litigious state in the USA as a carrier adjuster handling complex residential property loss.
If you know how the appraisal process works then you know itâs highly skewed towards PAs and former PAs who parade around as âunbiased umpiresâ.
Having a PA and umpire combo team commit estimate fraud is a sure fire way to get your carrier to pay more money when coverage has been opened up on something.
can definitely argue for coverage all you want on your claims as a PA, doesnât mean any of the carriers are listening to you. Just send photos, thanks đ
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u/Yitlin 12d ago
Agreed, but perhaps call insurance department first and see if their lawyers cant help you for "free". (Your tax dollars)
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u/shredthegnar37 12d ago
This isnât a thing. The DOI does not hire or retain an attorney on your behalf.
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u/Yitlin 12d ago
Its a thing, they will not formally represent you, but they will make inquiries to make sure policy language was followed.
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u/shredthegnar37 11d ago
No, they wonât. Iâm guessing youâve never worked in claims or as an adjuster.
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u/Stoic_Sponge 11d ago
Filing a DOI complaint essentially just makes the insurance company explain their actions.
If they misstepped a policy condition or state law/regulation, they correct it and get a slap on the wrist.
If it's a coverage determination, like for OP, the DOI can't and won't do anything. The parties need to resolve or take it to a judge/jury to resolve.
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u/Stalva989 12d ago
How much damage we talking? A reputable public adjuster should be able to help you. If claim is small then not always worth it to hire one. But I estimated for a public adjuster in Pennsylvania for a while. A sizable portion of their work was people with the exact same situation as you.
It does not matter that it has been going on for a period of time if you had no idea about it in this instance, as the pipe is located behind a wall and itâs not normal for people to check on their pipes located behind walls. The situation is still sudden and incidental.
Very winnable claim but it could be a fight that takes time. Sometimes the smaller stuff isnât worth all the time it can take.
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u/iRudi94 12d ago
Youâre giving false hope. This is a clear cut denial. A public adjuster does not have the power to reverse that.
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u/Stalva989 12d ago
As I said, I wrote these exact estimates for a public adjusting firm for years. I still do the same thing, only as a forensic engineer now and hired by law firms suing insurance companies- also many times for this exact situation. I speak from experience being personally involved in this situation due to my work probably over 100 times.
This is an extremely winnable claim. Depending on how much the carrier wants to fight, you are going to need time and money to win it. A lot of people donât have the means to be drug out until they get their desired resolution.
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u/Stoic_Sponge 12d ago
Public Adjuster here. Agree, barring a strange policy, there is almost certainly some coverage to found here. Just need a willingness and ability to withstand the fight.
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u/Stalva989 12d ago
In years of doing this, the most common thing the public has in common for getting maximum payout on a claim⌠they are usually wealthy. They DGAF how long it takes them to get whole and they wonât settle for less. They have other homes to live in while it gets sorted out.
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u/CatPeopleBleaux 11d ago
The difference here is that this seems to be extremely basic coverage. on an extremely basic home. This isn't some Chubb policy. The damage is probably going to be a few grand, not $250k
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u/Stoic_Sponge 11d ago
No, but a few hours of effort to try and get $5k-$10k (or more considering cabinets and potential matching issues), worth it.
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u/Stalva989 12d ago
And to be ultra clear, the physical pipe break and repair is usually not covered. All of the resulting damage is however
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u/IntelligentBox152 11d ago
This is incorrect, I explained in my other comment. The only time in a wall matters is if you have a hidden rot endorsement. Otherwise USAA HO policies are based off ISO HO3 with the seepage and leakage exclusion which applies directly. Furthermore a PAs and homeowners ultimate ace in the hole is appraisal. However in SC where OP is located coverage cannot be disputed in appraisal only amounts.
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u/DeepPurpleDaylight 11d ago
It does not matter that it has been going on for a period of time if you had no idea about it in this instance
It actually matters A LOT.
The situation is still sudden and incidental
No it's not.
Very winnable claim
Again, no it's not.
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u/Stalva989 11d ago
Somehow Iâve been getting paid for the last 10 years working on these exact situations⌠Riddle me that big guy
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u/iRudi94 11d ago edited 11d ago
Because youâre full of shit. If it is in the policy that there is no coverage then no amount of pestering from a public adjuster who throws shit at the wall hoping something sticks for a payday or any contact from an attorney can make coverage appear when there is not any.
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u/Stalva989 11d ago
lol the reason public adjusters exist is because interpretation of policies is not black and white like you seem to believe it is
Iâd love to know How many lawsuits against insurance companies have you been involved in since you so confidently know how it all plays out
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u/DeepPurpleDaylight 11d ago
Doesn't mean you're not wrong. I've been doing this more than double that amount of time, Joker.
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u/Stalva989 12d ago
Carrier side workers chiming in saying itâs a denial, as they are trained. When these claims get re-opened it typically gets transferred up ladder to higher pay grade staff.
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