by Zoltan Hovanyecz | Nov 4, 2015 | Florida Homeowners Insurance, Florida Insurance
All Florida homeowners insurance policies carry a deductible usually ranging from $500 to $2,500. Just like an auto insurance policy, the deductible is the policyholder’s financial responsibility for a portion of the damages in the case of an insurance claim. Unfortunately, deductibles have led to some confusion among policyholders deciding if they should file an insurance claim.
Occasionally, I hear concern from policyholders who tell me that they don’t want to file a homeowners insurance claim because they don’t have the money to pay their deductible or are concerned about having to come out of pocket for the deductible. With a $2,500 deductible, it would be impossible for some families to meet this financial burden, especially when faced with potentially other costly repairs and damages to the their home stemming from the insurance claim. However, it’s important for policyholders to understand that under a typical Florida homeowners insurance policy, you do not have to pay your deductible to the insurance company in the event of an insurance claim; the amount of your deductible is simply reduced from the total payment issued to you by the insurance company for the damages to your home.
For example, if you suffer a plumbing leak that causes $20,000 of damage to your home, and you have a $2,500 deductible, your insurance company would issue you payment in the amount of $17,500. You do not have to pay the insurance company your $2,500 deductible. In fact, you do not have to come out of pocket at all as long as you can find someone to make complete repairs to your property with the amount of money paid by the insurance company. Whether the insurance company paid enough to begin with is another issue previously discussed here.
There are however certain circumstances where the payment of your deductible can change. Depending on your insurance company, you may have an insurance policy that provides the insurance company with the “right to repair” or “option to repair” your home as previously discussed in our blog post entitled “The Insurance Company’s Right to Repair and Option to Repair; What are Your Rights and Options?” If your insurance company utilizes this process, rather than paying you directly for the damages to your home, the insurance company will choose and send their own contractor to make repairs to your home. The insurance company then pays their chosen contractor directly for the cost of repairs. In this situation, depending on your insurance company, you may be obligated to pay your deductible directly to the insurance company’s contractor before the work begins.
If you or anyone you know has questions about insurance policy deductibles, do not hesitate to contact us.
by Zoltan Hovanyecz | Sep 30, 2015 | Florida Homeowners Insurance, Florida Insurance
Many Florida homeowners insurance policies contain a specific clause called appraisal which can have a huge impact on the outcome of your homeowners insurance claim. Most homeowners have no idea that an appraisal clause exists in their insurance policy and find out for the first time when their insurance company demands appraisal of their homeowner’s insurance claim. To get an idea of what you are looking for, a typical appraisal clause looks similar to this: 
These appraisal clauses are nearly identical between most Florida homeowners insurance policies and can be used by either the homeowner or insurance company to determine the total amount of damage to the home. However, before a claim can be submitted to appraisal, the homeowner and insurance company must have a disagreement regarding the dollar amount of damage to the home. For example, if the insurance company decides that a plumbing leak has caused $5,000 of damage to your home but your contractor gives you an estimate of $20,000 to make repairs, the insurance company is entitled to demand appraisal to determine what the insurance company is obligated to pay you for your damages. Ultimately, this may result in you receiving less than the $20,000 it will cost you to make repair the damage.
The appraisal process requires that the homeowner and insurance company each select their own appraiser to represent them. The appraisers will then try to come to a mutual agreement as to the damages to the home. If they are able to agree, the final number will fall somewhere between the damages determined by your or your contractor and those determined by the insurance company. If the appraisers cannot reach an agreement, the appraisers are required to select a neutral umpire who will then make the final determination as to the amount of damages. The number arrived at via appraisal is FINAL and outside of very specific circumstances, cannot be challenged or circumvented.
Even in light of the nature of appraisal, is not necessarily a bad thing. Given the right circumstances, appraisal can be a benefit to the policyholder. In other circumstances, where appraisal may not be preferred, certain actions can be taken to avoid appraisal. If you have any questions about appraisal or about your claim in general, please don’t hesitate to contact us.
by Zoltan Hovanyecz | Aug 26, 2015 | Florida Insurance, Property Damage
Although you can never prepare for an insurance company’s dishonest tactics, you can certainly make sure you’ve done everything in your control to ensure the best chance of a fair and prompt resolution to your insurance claim stemming from hurricane damage to your home or business. This post will discuss the steps you can take before a hurricane strikes that will put you in the best position to recover the full amount of damages from your insurance company. The National Hurricane Center and a number of other sites have extensive guides on how to personally prepare your home and family for a hurricane so this post will only discuss the insurance aspect of hurricane preparedness.
Check Your Insurance Policy
Before you can even file a claim, you need to make sure you have the appropriate insurance policy and sufficient coverages. This includes making sure you have:
- Enough dollar amount of coverage under the dwelling portion (Coverage A) of your insurance policy to replace your entire home or business in case of a total loss. Too often when reviewing insurance policies I find that some clients do not even know that they are underinsured.
- Enough coverage for your personal property and scheduled items keeping in mind that typical insurance policies have very low limits for jewelry and collectibles unless you have specifically paid for scheduled or itemized coverages.
Document Your Home and Personal Property
When you file a claim with your insurance company, it would be helpful to show the condition of your home or business prior to the damage. Similarly, if you sustain damage to your personal property, the insurance company will want to see the condition and existence of the personal property prior to the damage.
I’ve found that the most efficient way of documenting personal property is by taking a video. This is very easy to do on your cell phone and can take as little as a few minutes to simply walk around your home documenting your personal property while narrating the descriptions. You can even store your video remotely on a cloud based service like Dropbox or iCloud should your phone become damaged or lost.
Have Your Home and Property Inspected
Insurance companies often deny claims saying that the damage is preexisting damage so it’s important to document the condition of your home prior to sustaining damage, especially your roof and interior finishes, showing that there are no current leaks or damage. Also have the rest of your home inspected and documented including screened enclosures, fences and air conditioning systems.
Know Who to Call When Disaster Strikes
Once you sustain damage to your home or business, depending on the severity, you should be prepared to call someone you trust to prevent any further damage to your home and to make temporary repairs. For example, if you sustain damage to your roof, you should be prepared to put a tarp on your roof. If you sustain water damage on the inside of your home, be prepared to call someone who can remove the water. And when you are ready to file an insurance claim, you should have someone you trust who you can call to handle your insurance claim for you.
If you have any questions on preparing your home or business for a hurricane or if you have suffered hurricane damage in Broward, Palm Beach, or Miami-Dade County, contact us for guidance or information.
For information on how to personally prepare yourself or family, a good resource is the National Hurricane Center’s hurricane preparedness guide which can be found here.
by Zoltan Hovanyecz | Jul 24, 2015 | Florida Homeowners Insurance, Florida Insurance
In Florida, most homeowners insurance policies contain a clause stating how soon a policyholder is required to report their insurance claim to the insurance company. Although each insurance policy differs slightly regarding notice to the insurance company, most policies consist of essentially the same reporting requirement. When a loss occurs a policy holder must:
give prompt notice to us or our agent
For example, during hurricane Wilma, many policyholders suffered damage to their roofs that was not immediately noticeable so these policyholders did not file insurance claims. It is not until sometime later that the policyholder’s roof would begin to leak from the damage caused by the hurricane. Because of this, some policyholders first reported their hurricane Wilma claim to their insurance company months and sometimes years after hurricane Wilma came through Florida. These “late reported” claims resulted in years of litigation in Florida Courts regarding what constitutes “prompt” notice and whether the insurance company is required to pay for the insurance claim when the notice is not “prompt.”
Reporting of Non-Hurricane Related Insurance Claims
For typical property insurance claims that do not result from hurricane damage, such as plumbing leaks, fires, drain backup, etc., “prompt” has been interpreted by Florida courts, in the most simplest sense, to mean that you must report your claim such that the insurance company is not prevented from conducting a full independent investigation and determination of coverage for your insurance claim under your insurance policy. Florida courts typically refer to this concept as “prejudice”, and depending on how “prompt” your reporting was, prejudice may be presumed against you and you may be required to prove that the reporting of your insurance claim did not “prejudice” the insurance company. For a full discussion of the legal standard for “prejudice”, you can read the Third District Court of Appeals case of Hope v. Citizens Property Insurance Corporation here. Some of the things that may considered “prejudicial” to the insurance company are:
- Repairs made to the home such that the insurance company cannot inspect the damages that existed at the time of the loss
- Discarding plumbing parts, pipes, or damaged building materials making them unavailable for inspection by the insurance company
- Failing to protect the property from additional damage resulting in further damage that makes it impossible for the insurance company to inspect the damages as they existed at the time of loss
Although these factors may make it more difficult to recover from the insurance company, they do not necessarily preclude you from doing so. Contact us for a free evaluation of your claim.
Reporting of Hurricane Related Insurance Claims
Since hurricane Wilma, the Florida legislature has created Fla. Stat. § 627.70132 which specifically address the time in which an insurance claim involving damage from a hurricane must be reported to the insurance company:
A claim, supplemental claim, or reopened claim . . . for loss or damage caused by the peril of windstorm or hurricane is barred unless notice of the claim . . . was given to the insurer . . . within 3 years after the hurricane first made landfall or the windstorm caused the covered damage.
If you have any questions about your insurance claim, please contact us.
by Zoltan Hovanyecz | Jul 1, 2015 | Florida Insurance, Property Damage
Condominium living in South Florida is a popular and convenient choice that comes with pros and cons. One of the biggest problems we have to deal with involving condominiums is when a unit owner suffers water damage to their own condo unit due to a water leak or plumbing break from a neighboring condominium unit (usually from a unit above). This problem is made worse when one or both of the unit owners do not have property insurance. This is more common than you would expect, even when many South Florida condominium associations have a mandatory requirement that each unit owner carry insurance for their own unit. The condominium association itself must also carry property insurance for the common areas of the building.
In Florida, condominium associations and condominium owners are governed by Chapter 718, Florida Statutes. This chapter explains in detail which areas of the condominium building must be insured by the condominium association’s insurance policy and those areas that are the responsibility of the individual unit owner.
According to §718.111(11), a condominium unit owner is responsible for insuring the following areas:
- All personal property (within the unit or in limited common elements)
- Floor, wall, and ceiling coverings (tile, marble, wood floors, paint, etc.)
- Built-in cabinets and countertops (kitchen cabinets, bathroom vanities, etc.)
- Water heaters (one of the most common sources of water damage)
- Electrical fixtures
- Appliances
- Water filters
- Window treatments, (curtains, drapes, blinds, hardware, etc.)
Of course if you do not have your own insurance coverage and your unit suffers water damage, you will be responsible for repairing the damage in these areas. If the water damage was caused by someone else in a unit above you or next to you, you may be able to recover from that person directly or their insurance company if they have one. However, whether that person’s insurance will pay for the water damage to your unit will depend on the specific facts of the claim.
As a condominium unit owner in South Florida, you have to expect that your unit can be damaged not only by a neighboring unit or the condominium building itself (such as a roof leak or leak from a common plumbing line), but also from the forces of nature. The best way to protect yourself from the uncertainty of potential damage is by buying insurance for your condominium unit.
Should you find yourself in a situation where your condominium unit has been damaged either by a neighboring unit, the condominium building itself, or the forces of nature, contact Schatzman & Hovanyecz, P.A. to discuss the facts of your claim and how we can best help bring about a favorable resolution for you.
