Extremely unusual homeowner situation

[dougmcm]

Houston, TEXAS: I recently had a very unusual loss to my home. On December 16 we had a gas explosion in the walls behind the bathtub which caused significant damage to two baths and two bedrooms. Since we have a septic system, we (the owners and the insurance co.) initially assumed that it was due to a leak from the drain pipes to the system. The gas is coming up through the foundation through the cutout for the bathtub drain and continues to do so to this date (8 weeks after the explosion). It is beginning to look like the source of gas may be from somewhere underground, rather than the septic system, because of the large volume that has come out. In this case it may not be possible to rebuild the home although it was not completely destroyed. If the source of gas cannot be determined or stopped the home cannot be rebuilt as it would obviously explode again as both I and the insurance company know. I believe in this case the dwelling should be declared a total loss.

We signed an initial agreement to allow the company to use their own building contractor to rebuild the home and guarantee the work for a specified amount. (We were informed we could use our own contractor but they would not guarantee results). This was before anyone knew the full nature of the problem and the possibility that we might not be able to rebuild it, so we did not obtain a separate estimate of our own. The policy is TEXAS HO-B which covers against all perils that are not excluded. What is likely to result from this? I am not sure at this point what the insurance company will decide, since they don't seem to want to discuss 'what if' questions yet. If they decide to pay for only the amount to rebuild what was damaged in the explosion, is it possible I would have any valid legal recourse? Their contractor's repair estimate is only about 30 percent of the policy coverage, so we would suffer a devastating financial loss.

 

[Donna32669]

Unusual HO Situation

First, where is your AGENT! You should have a copy of your policy which includes the "jacket" and all endorements that are listed on the policy (Declaration page). Look under "Exclusions" and review them, that may ease your worry. It sounds to me like the
company is not denying the claim so that is a big help. They have to put you back the way you were, no better or no worse - that is the basic purpose of insuance. However, look to see if you elected to (or were offered) "Guaranteed Replacement Cost", this
will cover you for the cost to re build, above the Coverage A (or
Dwelling amount), even if it exceeds the amount of insurance (this is usually capped at 25%or so). Again, your agent should be
able to explain this to you and help you communicate with the
"company", it's time for him to earn some of that commission he has been collecting. Remember, if you feel the claim is not being handled fairly you need to contact your State Insurance Commissioner, or read the section in your policy about Arbitration, it is there for YOUR protection. Best of Luck.

 

[Vickie2002]

I suggest hiring a public adjuster

As a homeowner with a huge problem I would advise you to look into hiring a public adjuster. They will make sure that your insurance company pays you what you are entitled to. In most cases a gas line that needs to be dug up to prevent furthur damage to a home is covered by your insurance policy. However it is all in the way that you present your claim. That is the job of the public adjuster. They are trained to talk the talk, and walk the walk in the insurace game. You don't want to end up paying for something that your insurance company is contracted to pay. Good Luck!