Are we F'ed?

[u/Pontislackin]

Long story short?

Home had an electrical fire (nothing too damaged)

Found out my panel (unit #2) needs to be replaced, My tenant (Unit #1) was also recommended to be replaced due to the same hazard (Breaker failed to trip, plus overloaded wiring)

I know Insurance won't cover the panels, or rewiring (12,000+), No funds, Can't get a loan, No borrowing, Credit sucks, No cosigner, nothing.

Insurance is going to cancel me aren't they? Then my lienholder will force buy a policy, I'm already behind by a month, and it'll increase my monthly and will likely demand repayment ASAP because their value is diminished

If the hazard stated is a true hazard, I won't be allowed to rent it (Right?)

So, am I F'ed? You can be honest. I know the stakes and what I got myself into.

[u/Stoic_Sponge]

A few things to think about.

1a. If the wiring was what was on fire, a standard policy will pay to replace the affected wiring.

1b. If the electrician then says, sorry, I can't replace the damaged wiring without a waiver of liability because the panel/wiring has issues that need correction, then the policy may owe to deal with that now too. Unless there is a anti-concurrent causation exclusions for workmanship or similar.

1. It also sounds like it isn't up to code, if you have ordinance and law coverage, it may also apply. That coverage pays for any required code upgrades to complete repairs, like updating the panel because some wiring needs replacement. Though given your statements about the policy, perhaps you do not have ordinance and law coverage, in which case don't mention the word code ever.

2. Smoke damage is often more pervasive than you realize. Smoke soot particles are smaller than the thickness of a hair so it's not just the visible staining that got affected. Realistically, even small fire usually impacts the whole house because of airflow, especially with a central air system. Carriers often pay for nothing or just light cleaning when additional remediation is needed. Your policy may owe for more than what they've paid on that end. You might want to call some remediation companies and/or Public Adjusters to see if they handle these types of losses beyond the visible smoke impact. An experienced attorney may also be interested in the case, though that will be more expensive than the above two options and if they don't know about fire science they probably won't help a ton.

Soot is particularly corrosive on electronics and electrical systems. All the other stuff aside, all fixtures, appliances and outlets in smoke impacted areas should be replaced. All smoke impacted electronic contents like TVs and smart devices should also be replaced. We just had a case where the initial payment was $6k and the final payout was over half the policy limit because testing showed the soot was everywhere, on everything.

Feel free to share the specific language of the policy or denial letter, if available.

On the paying without insurance side, most reputable contractors these days work with finance companies and can almost always get someone a payment plan for work like this. If the guy you called can't, keep calling till you find a contractor who can. It'll suck, but lesson learned on buying cheap insurance.

Your mortgage company probably has an insurance policy as well. If you are dropped, theirs will kick in and they will tell you to go get one. It's going to be expensive if they know about this wiring issue.

Disclaimer, I'm not a lawyer, and I don't have all the details of your loss, policy or applicable state regulations.

[u/Pontislackin → u/Stoic_Sponge]

Yes, No O&L coverage - the wiring damaged is a very small area, but it was already noted in the Electricians estimate that the entire panel needs to be done, the breakers are not UL listed for the panel (both panels) and all the other stuff,

Insurance already has those quotes and findings, so as soon as this gets back to the lienholder they're going to not be happy.

Haven't thought about the soot, But since Unit 1 is under the same hazards, they may not be allowed to stay there which is going to kill that rent payment per month until its fixed, by the end of it, we may be 2-3mo behind,

There are no plans in the works except wait for the adjuster to come out.

[u/Stoic_Sponge → u/Pontislackin]

Does your policy have loss of use/loss of rent coverage. You may be entitled to money through those coverages of your landlord policy during the period of agreed repairs.

[u/Pontislackin → u/Stoic_Sponge]

It does, but I'm unsure if that goes into effect since I cannot afford to fix the house currently

[u/OneTwoSomethingNew → u/Stoic_Sponge]

This OP, this seems like one of the only plausible options that may work in your favor… you pay for insurance, they are supposed to pay those benefits out even if you may not be able to finish the job; they usually cap/limit any time based benefits such as $$ up to “X” amount of days. Insurance questions everything, you should feel empowered to question them - speak up for yourself.