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UPDATED: Aug 23, 2012
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Insurance Question from Marysville, OH
Asked on 08/23/2012
INSURANCE We are trying to buy a home in the country. It has been vacant for about a year. The house was broke into and some plumbing (copper piping) and electrical were damaged. Approx. $7500 total. The house is near foreclosure. Therefore, the insurance was not fully paid and now they want to deny the claim......shoudn't the insurance co.be held responsible to fix all or partial damages? ISN"T that why the banks make us have ins? How can we make sure we aren't being asked to pay for something the insurance co. should be paying for.......In te event of foreclosures what is legal......advise
Answer given on August 26, 2012
Homeowner insurance is a contract with the homeowner and the insurance company. Part of that contract is that there is a sum to be paid to the company in exchange for them agreeing to pay for a claim. If the premium was not paid, and the insurance company sent a cancellation notice, and the claim was after the date of cancellation, then the insurance company does not have to pay the claim.There needs to be a determination as to when the theft of the pipes and electrical occurred versus the date the policy was cancelled. If this cannot be determined, then the date the claim was reported could end up being the date of loss, and if after cancellation, then there is no coverage.If the bank knew the insurance was cancelled, they will usually put coverage in force to protect their interest in the property. See if they had coverage if the insurance comapny denies the claim.
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