After Hurricanes Debby, Helene and Milton, many people are wondering about home insurance and how to proceed with fixing up damage. WUSF’s Kerry Sheridan spoke with Charles Gallagher, managing partner for Gallagher and Associates law firm in St. Petersburg, for some advice on common quandaries.
Should I wait for an adjuster before fixing damage to my home?
GALLAGHER: On one side, you've got an obligation to mitigate your damages, and on the other side, you've got an obligation to preserve evidence for the insurance company for their claim investigation.
Say I've got to rip out drywall, but I’m wondering, should I maintain some of it? Yes, so when the insurance carriers’ rep comes out, they can see, yes, this was full of water, and I had to rip it out. If you've got flooring and you've got water under that flooring, get the flooring up, get it outside. You want to do as much as you can to stop that mold from developing, or stop things from getting worse. If you have any kind of fans in the house, get them on and get them going.
You've got to mitigate to the level that is practical. If you've got a hole in your roof, does that mean you've got to hire the first roofing contractor to reroof your house? No. But go ahead and put a blue tarp up there and secure it from getting worse, absolutely.
If you're doing major repairs, get your insurance carrier to bless it early in the process. Tell them, ‘Hey, we've got a roofing contractor who can come out and do these things. But I want to make sure that you (insurance carrier, adjuster) can see the property and complete your investigation of the claim before I do this.’
You don’t want to jump too quick and have the insurer say, ‘Well, we don't know what the loss was there, and now we can't cover it because your roof has been completely replaced.’ So it’s real, real important to ask your carrier for consent.
Who is at my door, and should I sign those papers?
GALLAGHER: Another thing we've seen a lot of too, is people aren't quite sure who's soliciting them. And there have been examples we've heard of public adjusters presenting themselves as an adjuster and the homeowner thinks, ‘They're from my insurance carrier, therefore I've got to let them in and talk to them and sign what they asked me to sign.’
A public adjuster is a third party to the transaction, and someone who is hired as a private advocate for the insurance claim, so people need to know what that is, versus a representative from an insurance company that your insurance carrier is with.
And you're going to have third party adjusters that are independent adjusters that work for the insurance company. So even though you may have a claim with Liberty Mutual, someone from some other company may be coming out to your house to inspect your house that doesn't work for Liberty Mutual, but works for a third party, independent adjuster.
So when someone comes to your house, make sure you ask them who they're with, what they're there for. Were they sent there by your homeowner's insurance carrier? Were they canvassing a neighborhood for business?
There have been scenarios where people have had a public adjuster come out, and believing that they were from their carrier they ended up signing documents. And you're going to sign documents that give a percentage of recovery to a public adjuster. So be careful to figure out who they are. Before you sign anything, make darn sure well you know what it is.
Should I assign my benefits to a contractor?
GALLAGHER: Say you have a direct solicitation, a contractor comes to your home saying, ‘We see your problems. We can help you.’ One of the things that a homeowner will be asked to sign in that context is what's called an assignment of benefits. So if there is a payment under an insurance policy, it's not coming to you, it's coming to your contractor. Be very careful about those things. Don't sign those if you don't want them to get the entire check from the insurance carrier.
If a neighbor’s tree falls on my house, who pays?
GALLAGHER: If someone has a perfectly healthy — no prior sign or issue or concern — tree that is uprooted or slammed into your house, courts are going to regard that probably as an "Act of God." You can probably not hold that neighbor liable if they were maintaining the tree.
If it was negligently maintained, however, if you have a known diseased tree or a rotting tree, or a tree that already leaning or already seems unstable, and that homeowner who owns that property didn't do anything about that, they knew the property had some dangerous conditions, you're probably going to have a court find liability against that party there.
If you have insurance, you're probably going to have insurance cover your home, and they may subrogate against that other neighboring land owner if there are signs that they knew about it and were ignoring their duty to make it right.
If I have a mortgage, should I ask for a forbearance?
GALLAGHER: Contact your lender or your loan servicer, advise them, 'The hurricane hit us. We've got significant damage.' Many lenders and Fannie and Freddie typically have what are called hurricane holds. They're going to stop a process of a default under your loan or even a foreclosure. If they know that your area had a hurricane hit it and your house may have had damage, they will offer certain kinds of programs, forbearance programs and potentially modification programs to help you meet those obligations.
The caveat here is make sure you know what you're signing. During the pandemic, people were getting, 60, 90, or 120 day forbearance terms to withhold payments for their loan during those time frames. The problem was, they signed an agreement saying that on day 61, on day 91, on day 121, we're paying all those back payments, plus the next month's mortgage payment.
So if you have that ability, sure, go ahead and sign those agreements. But be very careful that you're not setting yourself up for failure.
Some of the lenders and servicers would work with you on a forbearance hybrid modification, where you are putting these payments on the end of the loan, or you are rolling them into the balance of your loan.
If I rent a place that floods, what are my rights?
GALLAGHER: We are getting a lot of calls about that, and what should a tenant do in the event of their property being determined a loss or not safe to live in? The first thing is, make sure you contact your landlord. Let them know immediately. The property is in bad condition. There's flooding in here. It's unsafe, things like that.
Go ahead and read that lease as soon as you can about your obligations in the event of casualty loss or disaster.
I doubt you're going to find any courts that are compelling tenants to pay rent where they can't use the property. And to that end, if you're a landlord, and 10% of the property usable, the other 90% is not, you're probably better off working with your tenant if you can get it repaired. If not, you're probably better off releasing them from the lease.
We don't want to see a series of evictions because landlords are holding people's feet to the fire and being not very flexible in terms of the realities here. If they can't use your leasehold, you shouldn't be charging them to have that lease.
And we've heard some accounts where landlords are not releasing last month's rent or security deposits, where properties are not habitable. They're completely destroyed. And again, I don't think a court's going to find favor with that. I think they're going to go ahead and support a decision with the tenant.
What’s the best way to work with my insurance adjuster?
GALLAGHER: We are seeing a lot of what are called ‘cat adjusters,’ or catastrophe adjusters. Because of the significance and the depth of this storm and how widespread it was, it's not possible for every insurance carrier to have their own local Florida-based adjusters adjust the claims. So they're bringing people from other parts of the country that have not dealt with hurricanes before. They're just there to be warm bodies and help address these claims. So that what's happening with cat adjusters is you're going to see folks that have probably a factor of five or 10 over a normal claim load. Say they usually have four or five claims a day. Now they're addressing 25 claims a day.
You want to be very patient with them, and you want to understand that the numbers are making it tough, and the carriers are doing the best they can to get people out there and to get your property seen and evaluated.
Ask your adjuster for a loss of use advance if you've got to leave your property because it's not safe. There’s a chance that your insurance policy has coverage for loss of use or additional living expenses that would be living outside the home if it's uninhabitable or for the period of restoration. So ask your adjuster, can I get an advance to live in a hotel, to live in an AirB&B, things like that.
The one other caution I'd give to folks would be don’t make a lot of gratuitous comments when you're talking to the adjuster. Someone, just because they're making chat and conversation, might say, ‘Well, that was an old lanai anyways. It was in bad shape, but the hurricane finished it off.’ You've just given the insurance adjuster some coverage defenses, of wear and tear or faulty work, stuff like that.
You have an obligation under the policy to do certain things. They're called post loss obligations. You’ve got to exhibit the property and take pictures of things. You have to make an inventory of content, and you have got to cooperate with them, but you don't have to go overboard on figuring out what you think the cause of the loss was, or saying things that are extra and over and above those obligations.
This conversation has been lightly edited for content and length.
