Hi! I need to know if anyone has a similar story and how it ended for them, or any advice on how to proceed.

We bought a rental house in June 2016 that needed LOTS of work. We noticed after finally getting the water on after fixing frozen pipes that there was sewage backing up in the basement. We didn't use lots of water so it wasn't overwhelmingly obvious until a few months later.

We were sure we just needed to auger it out, so we tried to fix it ourselves. When that was found unsuccessful we hired a plumber. That also proved unsuccessful. We were told that we needed to hire a specialty plumber that can dig up the street. We try contacting him many times and can't get a hold of him. By the time we got a hold of him and he suspected that the sewage line to the street is crushed ( which happens to be a state highway) it is already March and snow on the grown. It is too late to have the line replaced until the ground warms up.

The plumber did some investigating into the contracted work hired by the city a year or two earlier and discovered that it was a crushed pipe caused by the contractor while doing unrelated work. The sewage pipe replacement couldn't get finished until April 2017. Once it was finished we were very quick to rent it out. Only took a couple of weeks.

The City Administration office referred us to make a claim against the contractor for lost rent, who of course has contractor's insurance. Nationwide asks us many questions and finally this is their stance:

They specifically said, when we discovered the sewage was backing up during the summer, we should have gotten it fixed right away. That we were not trying hard enough to fix the situation in a timely manner.

To clarify once again so you don't have to reread it all... We believed it only needed to be augured. We did proceed to get it fixed. But by the time we KNEW it was beyond auguring it was too late have anything done.

So Nationwide basically admitted that claiming lost rent is acceptable but because we weren't quick enough to fix the problem, they weren't going to pay for any lost rent.

Any thoughts? Should we sue the contractor in small claims? I own a business and wouldn't want to be sued over a mistake but I feel like the insurance company is the one that should pay.