Pipes burst in an inherited house - insurance claim?

Question

Hey BP, so I'm in the process of inheriting a house from my step-mother's estate. It is out of state from me (PA), and has been cared for by my step-brother (executor). It was my father's house originally, and my step-mom was signed onto the deed when they were married. Apparently last spring, there was a freeze and some of the pipes burst causing significant water damage. My brother told me about this a month or so ago.

I just had the deed transferred to my name. I don't know why I never thought to ask about this, or ask him to do this, but is it too late to file an insurance claim? I am in the process of transferring the insurance to my name, but have not done it yet. My understanding is that the estate is currently paying for the insurance.

It sounds like a significant amount of damage, and I do not think I will be able to pay for the repairs out of pocket, hence asking about the insurance.

I have no idea why we didn't think of this, but I'm assuming it would be preferrable to have the estate make the insurance claim, as opposed to myself (so it wouldn't be on my personal insurance records), if this is even possible?

If that wouldn't work, would I even be able to make a claim considering that the damage occurred a while ago, and the insurance had just been transferred to me?

Thanks for any information

Bo Bond · Answer

Scott,

Great direction and details from both John and Caroline above.  Just remember that property and casualty insurance is almost always written on what's called a "per occurrence" form.  Therefore, the policy that was in place in the spring (at the time of this loss) would be the policy to review as John stated above, and the one to respond in this situation.  If you weren't the policy holder, then you would have to get the person who had that policy in their name at the time (sounds like your brother) to file the claim and get things going.

One other item to keep in mind is that you also need to know what the deductible is for water damage under that policy (if there was one in place).  I'm 99% sure the carrier will determine the peril to be water damage based off what you've described above.  If the water damage deductible is significantly less than the cost to clean and repair everything, then you should strongly consider filing a claim.  However, if the cost to clean and repair everything is about the same as (or less than) your water damage deductible, then you shouldn't file a claim.  There would be no significant payout for damages in this case, and no reason to ding your loss history record with that agent/carrier.

The last thing is that "some" policies do have certain stipulations on how quickly you should file a claim, but if the damages are significant enough, it can't hurt to just file it.  Make sure you have the date when the damage originally occurred.  If you don't have the exact date, an estimated date should be fine.  Keep in mind that mold is a very common exclusion in most policies.  If you expect any of that to be cleaned up and gotten rid of, it will most likely be out of your pocket.  Lastly, if any damage was compounded over the months while just sitting there unrepaired, you can expect the carrier/adjuster to likely reduce the payout.  This is because the policy holder has the responsibility to put a stop to the leak, and clean up as quickly as possible to keep from further loss/damage.  Not saying this wasn't done, but if it wasn't, expect it to complicate matters or the payout.

Sorry for the issues, but hope this helps!  Good luck!

John Mocker · Answer

Scott,

First thing is to review the policy.  What perils are covered (fire, theft, water damage, etc..) to make sure the claim would be for a covered cause.  Next, if the house was vacant, check the policy for a vacancy clause.  Many standard policies will lower the coverage if the property is vacant for a set period (ie 60 days).

If the pipe burst is covered on the policy and there is no issue with vacancy contact the agent.  Make sure this will not impact your new coverage.  If not, file the claim.  As mentioned before, they will want to know why the delay in reporting.

Generally on Homeowners policies, the pipes themselves are not covered due to freezing but the ensuing damage is.

Caroline Gerardo · Answer

Insurance company and adjuster will ask why you or they didn't make the claim when they became aware of the incident? The answer to the question will weigh upon if you can get anything. The insurance company will look at the title and policy names need to line up.

Pipes burst the spring a year ago?

Insurance does not just transfer to you. You notify them in writing/ask to change the policy.

Call the agent. This is a time when knowing your agent personally matters. You may need an attorney. Read every word in the policy.

Bruce Woodruff · Answer

How old is the house? If it's old, you may want to re-pipe anyway, using PEX instead of copper. Just a thought....

Pipes burst in an inherited house - insurance claim?

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