Unjust application of $2500 deductible to my settlement alone (common pipe burst)

[Anne Krause]

I live in Los Angeles. In July, my condo unit (Unit #103) and the unit above me (Unit #203) sustained extensive water damage caused by a pipe burst that occurred in the space between Units #203 and #303. Thus, the pipe was a
common element. The HOA's Farmer's Insurance adjuster who came out to assess provided our Property Management Company an estimate of repairs of damage to Units #103, #203, and "Building".

I also filed a claim with my own insurance company (USAA) for damaged personal items only. It was just this past week that my USAA adjuster looked at the Farmers Insurance settlement and noted that 100% of Farmer Insurance's $2500 deductible had been applied to my unit only! She informed me, "If the pipe was a common element, then the deductible should be split among all units that are claiming expenses with the association's policy. Be sure to contact your property manager and get that resolved before they issue funds to all units affected".

So in the past week, I attempted to contact, via multiple emails, our Property Management Company CEO and CFO, as well as the Farmer's Insurance adjuster (I copied our HOA President on all emails). BUT NO RESPONSE FROM ANYONE TO DATE!

If I do nothing, I stand to lose $1250 (50% of the $2500 deductible). What is my next best course of action? Call or send a certified letter to Farmer Insurance's Customer Service Dept? File a complaint with the Insurance Commission? Small Claims Court? I'd greatly appreciate some guidance on how best to proceed. I need resolution before funds are issued to the affected units (which may have already occurred for Unit #203, for all I know)!

 

[justalayman]

I have to presume this is considered a no fault (no negligence) incident. Otherwise there would be no deductible to be concerned with. Is this correct?

You need to read the policy to determine how any deductible is applied. If you discover the deductible must be split equally between the claimants (and I would think it would be) you cite that rule in the policy when contacting the insurance company.

In contrast, is it possible your insurance would cover you what should have been paid to you under the other policy and subrogate your claim from the other insurance company?

 

[Anne Krause]

You are correct in presuming that this is considered a no fault (no negligence) incident. But my own USAA adjuster confirms that the deductible still applies. Her words: "If the pipe was from a neighboring unit, then they should have the deductible reflected to their settlement. If the pipe was a common element, then the deductible should be split among all units that are claiming expenses with the association's policy" ... and ... "the deductible should be applied to the unit of origin or among all the units that filed a claim with their insurance. The association/board makes that decision". The pipe that burst is a common element (in the space between Units #203 and #303 above me), as already stated.

Re: your inquiry, "In contrast, is it possible your insurance would cover you what should have been paid to you under the other policy and subrogate your claim from the other insurance company?" I very much appreciate your suggestion! I will pose this question to my USAA adjuster! Thank you!