Live in Condo, Broken Water Main, Must File Insurance Claim Questions?

Question

Water main broke in early May (lets say May 4th) underneath sub floor of garden unit. At the time, the only insurance the association had was basic (policy held for nearly two years). Purchased an endorsement in mid-May (18th) that would cover the broken water main and the damage caused by such.

Called insurance in late July (22nd) to file claim. Insurance person asks when did the damage occur. Can't really remember the date but you say mid-May (16th). A claims adjustor is supposed to call you within 24hours.

1) If endorsement is purchased after damage occured, will damage be covered? 2) What questions will the claims adjustor ask? 3) Typically, how long does it take to settle a claim? 4) Should a condo owner file a claim with his own homeowners insurance in addtion to the associations insurance?

Answer 1

1. No. 2. They're going to want to contact the water company, which will show when the drastic increase in water consumption occurred - which will prove your claim fraudulent. 3. When coverage is not questioned, this type of claim typically takes a week to two weeks to settle. In your case, with a claim 9 months old, it will take a LONG LONG time, because the damage is old, the claim is old, it's just being reported, and even if you didn't say the endorsement was added after the claim, this just SCREAMS fraud. 4. Yes. The association policy will NOT cover any part of the building the owner is responsible for - typically drywall in, or studs in, and it won't cover any contents. Also, the association policy probably has a REALLY high deductible - somewhere between $5,000 and $10,000. Additionally, depending on how the water got into the unit, there's a really strong chance that it's actually a FLOOD claim, which isn't going to be covered ANYWAY. Although the unit owner probably doesn't have flood coverage either, and even if they did, it doesn't cover contents stored below ground level (like a basement).

Answer 2

First off before you make a claim, get your facts straight. You can easily call the water company and ask to check their records to see when they were out there to fix the broken main. If you file a claim saying a loss occurred after you purchased coverage, but in fact the loss occurred days before the coverage was purchased, the worst that will happen is that they can call the police and file charges of insurance fraud, at best they will deny your claim and then red flag your policy so that when renewal time comes up they will decline to renew your policy. After that good luck trying to get insurance elsewhere with that glitch on the record.
1) No
2) Typically who, what, where, why and how. They would also want names/phone numbers of witnesses (probably not applicable here), as well as asking questions about anything out of the ordinary (such as why did you wait two months to file a claim). They would also want a copy of any estimates that you have.
3) Depends on the complexity of the case. If there is any dispute as to the value of the loss, or whether the loss was caused by an insured peril, it could take a week or it could take a few months.
4) If there was any damage to their unit interior or its contents, definitely. If the building insurer denies the claim, the cost of repairs will have to be equally divided amongst the unit owners. In which case their policies should have a coverage to protect them in the event that an uninsured loss is divided amongst the unit owners.

Answer 3

Helluva can of worms you have here. All sorts of red flags on this one that could lead to all kinds of trouble for the condo assoc and any tenants

1. No
2. Depends if they catch coverage issue or not. Most questions will be about the timing of both the loss and when the endorsement was added. They will want to know if the endorsement was added in person and any paperwork signed.
3. Again depends on if they catch the coverage issue. Could be several months on this file
4. Yes, assuming that your policy was in force it should cover any water damage to your personal items. Most condo owner policies won't cover damages to the sheet rock, studs etc. If you haven't already done so contact your company ASAP!