Insurance and Damage Legal FAQ
This is for information only and is NOT a substitute for legal advice from a licensed attorney.
IT IS IMPORTANT TO NOTE THAT EACH INSURANCE POLICY IS DIFFERENT AND ANY ANSWER GIVEN TO VICTIMS ABOUT THEIR RIGHTS IS SUBJECT TO THE PROVISIONS OF THEIR PARTICULAR POLICIES.
In the unfortunate even that you have experienced a loss as a result of the recent flood event, you should report your claim immediately to your insurance carrier who can assist you with determining if your loss is if your loss is covered under your insurance policy. The following information is being provided for informational purposes only. Your insurance company can provide you with more definitive information as it relates to your specific claim.
What is “flood damage?”
Generally, damage caused by rising water, or water that has been on the ground prior to causing damage to your home.
My home was damaged when flood water entered my home. Will my homeowner’s policy cover this loss?
Most standard homeowners, renters and condominium policies do not cover water damage due to flood for the structure or contents.
Are my additional living expenses covered if I had to leave my home due to a mandatory evacuation?
Most standard homeowners, renters, and condominium policies do not cover loss of use and additional living expenses for flood as it is not a covered peril.
Will my homeowners policy cover damages caused by sewer material and water backed into my home or basement during a flood?
Most standard homeowners, renters, and condominium policies due to the back up of sewer materials into your home or basement due to a flood. Some insurance companies offer endorsements that may cover sewer backups.
Should federal disaster assistance pay for flood damage?
Before federal disaster assistance becomes an option, the effected area must first be declared a disaster by the Federal Government. Most federal government assistance is in the form of loans. Additional information is available at HYPERLINK “http://www.fema.gov/assistance” www.fema.gov/assistance
What if my vehicle is damaged as a result of the flood, will my automobile coverage cover this loss?
If you carry comprehensive coverage on your automobile policy, then you should have coverage for the damage caused by the loss.
How can I preserve my claims and protect my right to repayment from insurance coverage?
If you have an insurance policy that you think may cover your damage, whether it is a homeowner’s, renters or auto insurance policy, call your agent, broker or insurance company immediately to report your loss. Many policies exclude coverage for failure to timely report a claim. While this is not likely in a disaster, it is not worth taking a risk. It is always a good idea to contact your insurance company both by telephone and in writing. Even if there is no coverage for your particular claim, it never hurts to ask. If you believe the insurance company is incorrectly denying your claim, you may wish to seek further legal counsel. A list of lawyer referral services can be found below.
What if I live in a condominium?
If you own a condo, you should look at coverage provisions in both your association insurance policy and your individual unit owner’s insurance policy.
How do I get an insurance adjuster to come to my home and assess the damage?
Immediately following a disaster, you should contact your insurance company both by phone and in writing. Most insurance carriers have toll-free numbers that are designed to handle new claims. Your carrier should send an adjuster out to inspect your damage within days. If you are not satisfied with the timeliness of their efforts, contact the Tennessee Department of Commerce and Insurance’s Consumer Insurance Service at (800) 342-4029.
What can I do to prepare for the insurance adjuster?
If circumstances allow, make a list of all property damaged or destroyed, take pictures, collect names, addresses and telephone numbers of witnesses, obtain repair estimates, keep a record of expenses (such as alternative housing, etc.) and locate original bills and receipts for lost items. Submit these along with your claim to the insurance company.
What if I cannot wait for the insurance adjuster?
Some insurance policies provide for reimbursement for temporary housing relocation costs while your home is being repaired and for car rental costs while your car is being repaired or replaced. Check your policy or call your insurance company.
If your situation is desperate, make sure to let the insurance company know and, if the company agrees that there is coverage, ask for an advance payment toward your losses. Do not begin to replace lost or damaged property on the assumption that your carrier will cover the loss. Make sure you speak to your insurance company before replacing items.
What if the insurance company offers to settle?
You should consult an attorney before signing any release or waiver and before cashing any check from the insurance company that could be deemed full and final payment of your claim. Before you settle with the insurance company, be aware of the full extent of your damage and the full value of your claim. You might want to get multiple estimates before settling. While you may not wish to hire an attorney, this is the safest thing to do to protect your interests. A list of lawyer referral services can be found on page 80 of this document.
What if the insurance company denies my claim or offers me less than I think I am entitled to receive?
You should demand that the insurance company give you in writing its reasons for denying the claim. Insurance companies are subject to the bad faith laws of the state of Tennessee. Thus, they must be very certain when denying or compromising your claims. In this circumstance, you will want to consult with an attorney.
What if my insurance does not cover all of the damage to my home or personal property?
You may be eligible for benefits under the FEMA program if you are unable to pay for the repair or replacement of essential parts of your home or essential personal property. See the “Housing Issues” section of this manual for a discussion of FEMA benefits.
You also may file your losses with the IRS on your income tax return the following year. Make sure to keep all repair and replacement receipts. For information on this option contact the IRS at (800) 829-1040.
My house was damaged and I cannot live in it. Do I need to pay my mortgage?
You must pay your mortgage even if your house is damaged and you cannot live in it. However, check with your lender, as many companies offer a grace period of several months to delay payments (although interest may continue to accrue). In the event you are able to reach an agreement, it is important to request that the lender verify the agreement in writing.
What if I cannot pay my mortgage?
If you have received a written foreclosure notice as a result of a disaster-related financial hardship, you may be eligible for FEMA payments to help you with your mortgage. If you have income and you want to keep your house, you may be able to file for bankruptcy protection. For instance, you may file a Chapter 13 bankruptcy. In a Chapter 13 bankruptcy, the homeowner proposes a plan of how he or she will pay regular mortgage payments and all other living expenses, and also pay an amount every month toward the mortgage arrears. If you think you want to file for bankruptcy protection, you should consult with an attorney.
What if I live in a condominium?
If you live in a condominium or pay maintenance to any type of homeowners’ association, you still need to pay your maintenance fees even if your homeowners’ association is not fixing the common areas or you do not like the way they are handling repairs. You should attend homeowners’ association meetings to voice your concerns and talk with other homeowners and members of the board about your complaints. A group of residents may decide to seek legal advice. If you simply stop making your maintenance fees, however, you may be subject to foreclosure and other financial penalties.
I have homeowner’s insurance, but was told it will take months for an adjuster to look at my house and that it will take even longer for a check to be issued. Am I eligible for any type of assistance in the interim?
If you have homeowner’s insurance, you most likely will be eligible for funds to help with living expenses while you cannot live in your house. You need to contact your insurance company. If you do not have homeowner’s insurance then you may be eligible for assistance under FEMA’s Individual and Family Grant (IFG) program to pay for necessary repairs to essential parts of your home. You may apply for IFG funds by telephone at (800) 462-9029. For TDD assistance, call (800) 462-7585.
What if my landlord won’t negotiate with regard to my apartment?
In Nashville, if the home and the property is damaged to the extent that it is substantially impaired, then the tenant may immediately vacate the premises and provide the landlord with written notice within fourteen (14) days of vacating the premises. If this is done, then the lease is terminated and the landlord must return all prepaid rent and security deposits. Further, an apportionment of rent must be made as of the date of the disaster.
The rental contract should be examined to determine its provisions with regard to destruction of the premises. If the lease is silent, then the tenant is responsible for all rent if the tenant leases the entire premises. If the rental property is a portion of a larger building, then the lease is terminated as of the date of disaster, assuming it substantially impairs the tenant’s use of the property. In either case, tenants should send a certified letter, return receipt requested, to the landlord notifying him or her of their actions.
All my stuff was destroyed when the roof fell in on the place I rent. What help can I get?
If you had renter’s insurance at the time of the disaster, contact your insurance company. If your situation is desperate, make sure you describe your situation to the insurance company. If the company agrees that there is coverage, you can ask for an advance payment to cover a part of your loss. See the “Common Questions Related to Insurance” section on page 12 of this document for information about preparing for an adjuster’s visit and handling insurance claims.
What if I do not have insurance on my property?
If you do not have renter’s insurance, see if your landlord had insurance to cover your belongings. However, this is not likely. If your losses are not covered by any insurance policy, you may be able to get Individual and Family Grant (IFG) money from FEMA for replacement of necessary items of personal property. You may apply for IFG funds by telephone at (800) 462-9029. For TDD assistance call (800) 462-7585.
My landlord told me to move out the next day because he wants the apartment for his daughter who lost her home in the disaster. He told me that if I do not leave, he would change the locks. Do I have to move?
Tennessee law does not allow a landlord to lock you out, turn off utilities or use any other “self help” means to get you to leave. The landlord must file an eviction action (called a detainer warrant) in court. You only have to move out after the judge in your case enters a final judgment. In Nashville, the landlord must give you written notice before filing a detainer warrant. Furthermore, if the landlord locks you out or terminates utilities to get you out, then the landlord can be subject to an action for damages. If the landlord does lock you out, you can call the police to re-gain entry. You should also consult an attorney.
Must I continue paying rent even though my apartment or office has been completely destroyed or severely damaged?
In Nashville, if the rental unit or property is damaged to the extent that it is substantially impaired, then the tenant may immediately vacate the premises and provide the landlord with written notice within fourteen (14) days of vacating the premises. If this is done, then the lease is terminated and the landlord must return all prepaid rent and security deposits. Further, an apportionment of rent must be made as of the date of the disaster. If the property is not covered by the Uniform Residential Landlord and Tenant Act, then it must be determined whether the property is a portion of a building or a single unity, such as a leased house. In either event, the rental contract should be examined to determine its provisions with regard to destruction of the premises. If the lease is silent, then the tenant is responsible for all rent if the tenant leases the entire premises. If the rental property is a portion of a larger building, then the lease is terminated as of the date of disaster, assuming it substantially impairs the tenant’s use of the property. In either case, the tenant should send a certified letter, return receipt requested, to the landlord notifying him or her of the situation.
Can I sue my landlord for injuries I suffered in my apartment or office during the disaster?
When injury results from the disaster itself and not from defects in the demised premises (which the landlord may be obligated to repair), the landlord has no liability for such injuries. As such, there is no implied promise by the landlord that no harm will come to the tenant from a natural disaster.
Is the damage to my home covered under my insurance policy?
Hazard insurance (i.e., homeowners policies or other fire and extended coverage policies) from the private sector generally does not cover flood damage. It may cover water damage inside the home but damage from floods or surface water is usually specifically excluded. Windstorm insurance is normally limited to greater-than-normal wind conditions.
The federal government provides coverage for flooding under the National Flood Insurance Program (NFIP). Policies can be purchased from any state licensed agent. Individuals can search for an agent in their area by city, state or zip code on FEMA’s web site at: http://www.floodsmart.gov/floodsmart/pages/agentsearch/searchform.jsp.
Even if policies extend coverage to the type of disaster damage that occurred, they may limit coverage to losses directly resulting from the disaster. Courts generally have found coverage if the covered risk was the efficient cause, if not the only cause, of the loss and even if the other concurrent causes are otherwise expressly excluded from coverage.
May I sue the person from whom I bought my home for not telling me about the possibility of flooding?
If an affirmative misrepresentation was made by the seller concerning the possibility of flooding, an action for fraud may be maintained, assuming all other elements of fraud are present. It is important to note that an action based solely on the residential disclosure statement required under Tennessee law must be brought within one (1) year from the date the purchaser received the disclosure statement or the date of closing, whichever occurs first.
Does my automobile insurance cover damage to my car resulting from the disaster?
Normally, auto insurance will cover damage under the comprehensive policy coverage, although the particular language and exclusions of the policy will control. Even if an exclusion from comprehensive coverage exists for damage caused by natural disasters, coverage may exist under a collision policy if the natural disaster and event causing the damage could be construed as a collision.