Insurance Question: Will Sellers Ins. Cover Hail Damaged Roof?

[Mindy Jensen]

I am the agent representing the buyer. Inspection showed hail damage on the roof. Roof is in great condition, but is 21 years old - a dinosaur here in Colorado.

If sellers make insurance claim, will insurance cover the hail damage after closing if claim is made before we close? 

[Jason Bott]

@Mindy Jensen there is so many different ways this could go, so here are a few thoughts/comments.

1)  If the seller can identify when the claim happened, then yes, they can.  If they can not identify it, and the damage looks old, there is a good chance it will be declined.  

2)  Any claim payout would be made to the name on the insurance policy.   This check/payment can not be assigned to the buyer.

3)  It's possible client already made a claim and pocketed the $.  They are not legally required to fix it.  They lost value in their asset, were compensated, and now will realize the loss when they sell to your buyer.

4)  Seller may not have coverage in their policy.  If it's just cosmetic, its very common in hail prone areas like CO for there to be an exclusion for cosmetic damage, or you get a credit on your insurance premium if you elect to take the exclusion.

Let me know if you have any other questions on it.