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O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc #2746066
02/24/20 11:26 AM
02/24/20 11:26 AM
Joined: Jan 2003
Posts: 7,326
Albany, NY
67SATisfaction Offline OP
The member whose name is actually Art
67SATisfaction  Offline OP
The member whose name is actually Art

Joined: Jan 2003
Posts: 7,326
Albany, NY
Hey guys,
I thought I'd share this little insurance story here because I think some of you have more than one homes, or property, or rental property, or other ownership arrangements...

Some 5-6 years ago, a friend bought a 2nd home, kind of as an investment for the long-term, and his mom put some money towards the purchase. Both my friend's and his mom's names are on the deed (or title). He got property/home insurance on the home/property. The house is rented out.

The home suffered an accidental fire, and is a total loss. I don't know the origin of the fire, there is no prosecution or blame game going on, the Fire Dept didn't find anything suspicious or criminal. It is ruled an accident.

Now comes the punchline - my friend went through his insurance, and their payout is only 1/2 the total loss, because only HIS name is on the insurance policy. His mom is not listed on his policy as an Insured, but she is a part-owner because her name is on the deed. The insurer isn't paying "his mom's part" of the loss, because she doesn't have a dedicated insurance policy. He has fought a brave battle, but this seems to be the way it shook out.

This is in New York state.

I just thought I'd share in case any of you have anything similar... check your policies?

Best,
- Art


1965 Satellite hardtop 361/2bbl, console 727, open 2.76
1967 Satellite convert 383/4bbl, column 727, open 3.23
1975 Maserati Bora, US spec 4.9L DOHC hemi V8, 5-spd ZF man
1977 Maserati Khamsin, Euro spec 4.9L DOHC hemi V8, 5-spd ZF man
1982 Alfa Romeo GTV6, 2.5L SOHC hemi V6, 5-spd man transaxle
2007 Aston Martin DB9, 6.0L DOHC V12, 6spd man transaxle
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: 67SATisfaction] #2746187
02/24/20 06:21 PM
02/24/20 06:21 PM
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Las Vegas, NV
Tom_440 Offline
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Wow.

Did your friend fill out an application stating he was the sole owner of the house and the insurance company believes that was a material misrepresentation?
Is there something in the policy that states they only pay for half the repairs when there is a second owner not listed on the policy?
Your friend may ask the adjuster whether the insurance company was collecting 100% of his premium to insure 100% of the house all these years?
If your friend and his mom are both on the deed as "Joint tenants" (if they do that in New York), then each has rights to 100% of the house...
I'm not saying your friend should have a quick consultation with a lawyer to see if the insurance carrier's response is truly "bad faith," but this smells kinda funny from here.

Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: Tom_440] #2746195
02/24/20 06:43 PM
02/24/20 06:43 PM
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Doc Fiberglass Offline
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Many times it’s been said .... and I’ve learned FIRST HAND during my first claim I ever filed just recently....

An insurance company is not your friend down

Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: Tom_440] #2746205
02/24/20 07:07 PM
02/24/20 07:07 PM
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Originally Posted by Tom_440
Wow.

Did your friend fill out an application stating he was the sole owner of the house and the insurance company believes that was a material misrepresentation?
Is there something in the policy that states they only pay for half the repairs when there is a second owner not listed on the policy?
Your friend may ask the adjuster whether the insurance company was collecting 100% of his premium to insure 100% of the house all these years?
If your friend and his mom are both on the deed as "Joint tenants" (if they do that in New York), then each has rights to 100% of the house...
I'm not saying your friend should have a quick consultation with a lawyer to see if the insurance carrier's response is truly "bad faith," but this smells kinda funny from here.


New York has joint tenancy IIRC.

A call to the insurance commission office may be in order as well. Something seems out of order here unless there is specific language to deny re: tenants in common ownership. Joint tenancy I believe the insurance company is out of luck.

Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: Doc Fiberglass] #2746206
02/24/20 07:08 PM
02/24/20 07:08 PM
Joined: Jan 2003
Posts: 5,611
Abilene, Texas
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fastmark Offline
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Man I would get a lawyer. I bet they were charging him the entire premium for the policy. I’d at least go the the state board. It might even be worth a jail sentence to punch your agent in the nose.

Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: Tom_440] #2746207
02/24/20 07:10 PM
02/24/20 07:10 PM
Joined: Dec 2007
Posts: 16,636
Puttin' on the foil in Charles...
not_a_charger Offline
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Originally Posted by Tom_440
Wow.

Did your friend fill out an application stating he was the sole owner of the house and the insurance company believes that was a material misrepresentation?
Is there something in the policy that states they only pay for half the repairs when there is a second owner not listed on the policy?
Your friend may ask the adjuster whether the insurance company was collecting 100% of his premium to insure 100% of the house all these years?
If your friend and his mom are both on the deed as "Joint tenants" (if they do that in New York), then each has rights to 100% of the house...
I'm not saying your friend should have a quick consultation with a lawyer to see if the insurance carrier's response is truly "bad faith," but this smells kinda funny from here.


Agreed. Something is either missing from what OP's friend is telling him, or something is not right with the denial of coverage.


Earning every penny of that moderator paycheck.

DBAP
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: not_a_charger] #2746339
02/25/20 08:21 AM
02/25/20 08:21 AM
Joined: Jan 2003
Posts: 7,326
Albany, NY
67SATisfaction Offline OP
The member whose name is actually Art
67SATisfaction  Offline OP
The member whose name is actually Art

Joined: Jan 2003
Posts: 7,326
Albany, NY
Thanks guys,
Yeah, doesn't it sound whacked? A policy is a policy, right? I'll mention to him some of those questions and suggestions.. AFAIK he hasn't settled yet ...

He said he was working with an adjuster, and IIRC got a second opinion, but are adjusters impartial? I wonder whose word he is taking as truth. New York insurance commission, etc - we do have some solid consumer protection services here. I don't know how carefully he has reviewed his policy, but I think he is the type that would consult an attorney to be sure he's not leaving any stones unturned. There is $130k at stake and he still owes on the mortgage.. (mortgage-banks always demand proof of insurance, but maybe they scrutinize the policy to verify for themselves that insurance has full coverage?).

Anyway - thanks for your input, I'll update y'all if there is any news next time I see him.
- Art

Last edited by 67SATisfaction; 02/25/20 08:22 AM.

1965 Satellite hardtop 361/2bbl, console 727, open 2.76
1967 Satellite convert 383/4bbl, column 727, open 3.23
1975 Maserati Bora, US spec 4.9L DOHC hemi V8, 5-spd ZF man
1977 Maserati Khamsin, Euro spec 4.9L DOHC hemi V8, 5-spd ZF man
1982 Alfa Romeo GTV6, 2.5L SOHC hemi V6, 5-spd man transaxle
2007 Aston Martin DB9, 6.0L DOHC V12, 6spd man transaxle
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: 67SATisfaction] #2746350
02/25/20 09:13 AM
02/25/20 09:13 AM
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Ossining, New York
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Nukechargerboy Offline
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Just another reason to leave New York.

Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: 67SATisfaction] #2746364
02/25/20 10:10 AM
02/25/20 10:10 AM
Joined: Dec 2007
Posts: 16,636
Puttin' on the foil in Charles...
not_a_charger Offline
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Quote

He said he was working with an adjuster, and IIRC got a second opinion, but are adjusters impartial?


That sounds as though he hired an independent adjuster to work on his behalf. If that's the case, it's not a question of impartiality, because that person is supposed to advocate for him.

Quote
A policy is a policy, right?


No. Every insurers has lists of exclusions, limits, etc. and they can vary from company to company. Every policy must be approved by the state, and any ambiguous language is to be interpreted in favor of the insured. Very few people actually read their policy. There are 2 scenarios that are more likely than any others: If the insurer's response was to pay half, either the policy language allows them to do so in this situation, which means your friend screwed up. If the policy language does not explicitly allow them to do so, the insurer is acting in bad faith.


Earning every penny of that moderator paycheck.

DBAP
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: Nukechargerboy] #2746383
02/25/20 11:18 AM
02/25/20 11:18 AM
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Whoa-is-mia
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Nor Cal has recently gone through a spate of large wildfires incurring billions of structural damages and total losses.
Working in the construction world I've heard several stories of Insurance companies not paying full replacement costs and the explanation generally includes all sorts of failures of the insurance company to "fairly settle".
I'm not saying it's the case with the o.p. situation yet digging on the local issues I've heard generally yields the property was not fully covered. Either the property is not insured at current value, insured for replacement cost, or for building code upgrades. Another issue I've heard repeatedly is a small home is added on to repeatedly and upgraded finishes and accessory buildings added without listing them on and included in insured premises. Lastly, unpermitted construction is both difficult to prove quality and or that it actually existed.
I have seen almost no problem with people having their homes replaced if they have all construction permitted, on the tax roll, construction replacement value and building code upgrade endorsements, and pictures of everything (finished and appliances, belongings, if insured) in the hands of their insurance agent (and a safe deposit box).



Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: 67SATisfaction] #2747986
03/01/20 10:44 AM
03/01/20 10:44 AM
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New Jersey, USA
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yella71 Offline
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Insurance company's are not in business to pay you the are in business to make themselves money. they are very good at finding ways to NOT pay you.


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Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: not_a_charger] #2748348
03/02/20 03:26 PM
03/02/20 03:26 PM
Joined: Jan 2003
Posts: 7,326
Albany, NY
67SATisfaction Offline OP
The member whose name is actually Art
67SATisfaction  Offline OP
The member whose name is actually Art

Joined: Jan 2003
Posts: 7,326
Albany, NY
Thanks for tour input, guys..

Originally Posted by not_a_charger
Quote

He said he was working with an adjuster, and IIRC got a second opinion, but are adjusters impartial?


That sounds as though he hired an independent adjuster to work on his behalf. If that's the case, it's not a question of impartiality, because that person is supposed to advocate for him.

Quote
A policy is a policy, right?


...Every policy must be approved by the state, and any ambiguous language is to be interpreted in favor of the insured. There are 2 scenarios that are more likely than any others: If the insurer's response was to pay half, either the policy language allows them to do so in this situation, which means your friend screwed up. If the policy language does not explicitly allow them to do so, the insurer is acting in bad faith.


thumbs Thank you for this clear and detailed summary, not-a-charger.

UPDATE:
Had lunch with this buddy on Friday, and... his answers kinda rambled, but the essential information I got was...

- He said as far as he knows, he was paying a premium that was what full coverage would cost. He didn't say how he knew. I suggested he confirm with his agent or other sources.
- Yes, he definitely hired an independent adjuster, for a fee. The fee is pretty large, but there is $400k on the line so...
- He said he received a check for 75% of the (assessed value or adjuster's estimate?) from the insurance company.
- After consulting with his insurance agent, who said it that it would not limit his options, he took the step of cashing the insurance company's check to pay the adjuster's fee (I've always been told it is risky to cash the check because it can imply you accept the insurance company's settlement amount and limits your options for pursuing further insurance money).
- Apparently the insurance company signaled they want to withdraw the 75% offer, and reduce it. He told them no, and he still wants 100% of what the policy (and adjuster's estimate) should allow him (If they really wanted to withdraw, wouldn't the insurance company just put a Stop Payment on the check? Makes no sense to me. Maybe they're just playing games to make him happy he got the 75%).
- I told him he could contact the New York Insurance Dept. to get help or file a complaint.

Further comments are welcome, but...

..at this point there seems to be enough carelessness, vagueness and unconfirmed information, it doesn't make me feel like I can offer him much more help.

So guys, thanks again for your input... hopefully there is something to learn...

Cheers,
- Art



Last edited by 67SATisfaction; 03/02/20 03:28 PM.

1965 Satellite hardtop 361/2bbl, console 727, open 2.76
1967 Satellite convert 383/4bbl, column 727, open 3.23
1975 Maserati Bora, US spec 4.9L DOHC hemi V8, 5-spd ZF man
1977 Maserati Khamsin, Euro spec 4.9L DOHC hemi V8, 5-spd ZF man
1982 Alfa Romeo GTV6, 2.5L SOHC hemi V6, 5-spd man transaxle
2007 Aston Martin DB9, 6.0L DOHC V12, 6spd man transaxle
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: 67SATisfaction] #2748370
03/02/20 04:36 PM
03/02/20 04:36 PM
Joined: Dec 2007
Posts: 16,636
Puttin' on the foil in Charles...
not_a_charger Offline
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Your buddy is not being straight with you. Red flags all over his reaction/responses to you. That doesn't mean the insurance company is right in this instance. I have no idea if they are, or are not, but I can tell from what you've posted thus far that your buddy has a hand in this issue.

Quote
I've always been told it is risky to cash the check because it can imply you accept the insurance company's settlement amount and limits your options for pursuing further insurance money


That's not correct. There is no such thing as an implied settlement.


Earning every penny of that moderator paycheck.

DBAP
Re: O/T - Home insurance vs Deeded owner, 2nd Home, Rentals, etc [Re: not_a_charger] #2748445
03/02/20 10:31 PM
03/02/20 10:31 PM
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I agree. A lot could be settled by seeing the declarations page of the policy.
Again, recurrently, I've heard all sorts of bashing of insurance companies that were complying with their policy. Most problems with settlements for loss can be traced to owners saving money (on insurance costs, the permit dept or the tax man).
This could be much like changing the terms of any contract, agreement or bet.









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