Type of policy: Homeowner policy.
City: San Gabriel, CA.
Description of loss: Single story house with heavy wind damage to wood shingle roof and intrusion of rain water into interior of the house during winter storm season.
Insurance Adjustment Summary:
- Initial settlement prior to Jae Park & Associates, Inc., involvement at $4,390.09 (Before deductible).
- Total insurance settlement after JPark Public Adjusters (PA Jae Park), Inc., involvement of adjustment of the claim $20,085.06(Before deductible). Differences in settlement amount of $15,694.97.
One night at the beginning of the 2012 winter season, a very strong wind began to blow. Due to this powerful wind, a two-story property located 20 miles northwest of Los Angeles caused a great distress for its next-door neighbor. A huge tree in the backyard could not withstand the strong wind and collapsed, breaking part of homeowner Mr. B’s fence, causing huge damage to the roof as well as inside of Mr.B’s neighboring house.
Right after the accident, Mr. B filed a claim to the insurance company after consulting with the insurance broker. A few days later, he was notified of the compensation and was surprised to hear the result.
- B’s insurance company could not compensate for the damage caused to the neighbor’s house. The reason for denial was that for the last three years the house had been rented to other people and Mr. B had not lived in the house himself. The insurance company pointed out that when leasing the home, the policyholder should notify the insurance company. Furthermore, the policyholder did not have the appropriate insurance contract for leasing the house.
- For Mr. B’s collapsed fence, the repair cost of $1000 was agreed to be compensated.
- As for the tenant’s luxury car, which the fallen tree had damaged, it was not to be compensated (but was eventually resolved by the tenant’s car insurance company).
Based on the above claim results, the neighbor sorted out the damage with his own home insurance company and in February 2013, the neighbor’s insurance company notified Mr. B that the compensation lawsuit was filed (subrogation). The insurance company asked Mr. B to pay the damage compensation which they had paid for. The amount was almost $100,000.00. Mr. B who was surprised to see the considerable litigation costs, made every effort to find a solution. When he finally found me in mid-May 2013, he considered me to be his final hope. About three months passed after receiving the initial notice. After hearing the distress that Mr. B went through, I had to reject Mr. B’s case. I could not solve his case. In other words, the case was impossible to accept. It was heartbreaking for me. The provision concerning house rental including changes in usage of the house is specified in most of the related insurance policy terms. The policyholder must notify insurance company his house is rented out anytime during the contract period. If the house is intended to be leased, it is the policyholder’s duty to inform the insurance company immediately and the insurance contract should be modified. If the policyholder does not mention this, the relevant insurance contract will automatically become invalid. Recent insurance industry trend is to enforce such regulations in a stricter fashion, so they tend to avoid paying the claim. It is the policyholder’s responsibility to inform the insurance company of any changes made to the insurance contract. The responsibility of any problems that occur without notification is not that of the insurance broker or agent. It is not a matter of complaining that the insurance sales professionals did not take care of everything. In other words, the policyholder should tend to his own affairs so that he can keep his property well.
I would like to conclude this column by providing tips for policyholders dealing with flood damage. The policyholder has various duties to fulfill after the loss under insurance policy, I have mentioned these duties and regulations many times before. Flooding is also one of those sensitive type of the loss that shows a sharp difference between policyholder and the insurance company understanding of its duties and responsibilities. The policyholder should be prudent when dealing with insurance contracts, taking into account the size of the expected damage, where compensation might be large.
“If water damage has occurred; to avoid the situation from worsening the policyholder should
- stop the leak, or source of the water
- Take all possible actions to remediate the loss from further damage.
The policyholder’s duties after the loss in the case of a water loss claim is a powerful clause in the insurance contract.”
Photos after the loss:
Photos after the repair: