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Insurance claim for basement flood

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  • Mar 10th, 2019 3:36 pm
[OP]
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Mar 8, 2006
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Insurance claim for basement flood

Our basement, garage and two cars flooded at 2:30 AM two days ago due to a city watermain pipe that burst in front of our house (2-3 feet of water in our basement). A company the insurance deals with came the day after and took pictures and told us that everything needs to be gutted. Tomorrow the insurance adjuster is coming to take a look at everything. We want to hire our own company to do an estimate because we have heard stories that they will quote really low for renovations. We also spent the last two days cleaning, laundry etc. Can we claim our hours? Can we use our own renovation company? We took tons of video and pictures beforehand and the fireman gave us a city claim number as well. We have never dealt with insurance before so are there any suggestions or tips?

Thanks.
24 replies
Deal Guru
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Feb 11, 2007
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Oakville
Have you told the insurance company what you would like to do? What did they say?
[OP]
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Mar 8, 2006
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They are only coming tomorrow. We will advise them of course but were wondering if anyone knew or had tips.
Deal Addict
Jan 28, 2007
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SW Ontario
I'd get an independant estimate as well. Generally speaking, insurance companies tend to lowball and mitigate their losses wherever possible.

There are a number of people I know who have rejected their first offer amount, to argue and settle for a higher amount.

You do not have to use their contractors for the repair work.
I'd rather be outdoors camping, kayaking, and mountain biking ...
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Nov 17, 2012
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Toronto
Have you gotten to the point where your insurance company has actually told you that you're covered? Their first job is to find some reason to not provide coverage. That's their business.

I'm sure you are - just make sure you have a copy of your policy handy and have read it carefully.
[OP]
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torontotim wrote:
Feb 11th, 2019 7:26 pm
Have you gotten to the point where your insurance company has actually told you that you're covered? Their first job is to find some reason to not provide coverage. That's their business.

I'm sure you are - just make sure you have a copy of your policy handy and have read it carefully.
We read the insurance contract and are covered (at least we believe so since it mentions water damage) we also opened up a claim with the city.
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Jan 28, 2007
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boneca wrote:
Feb 11th, 2019 7:33 pm
We read the insurance contract and are covered (at least we believe so since it mentions water damage) we also opened up a claim with the city.
I had been wondering what liability the city waterworks would play in this claim.
At a minimum, any insurance deductibles enforced should be paid by the city as a starting point in the discussion.
I'd rather be outdoors camping, kayaking, and mountain biking ...
Deal Addict
Nov 17, 2012
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Toronto
I had a tree come down (city owned) in the windstorm that ripped our mast / electrical service off the house. You end up with 2 choices. You can either file a claim with your insurance company, and they will then go after the city or whoever caused the damage (as they would normally) or you can file a claim with the city.

I don't expect you do both or try to negotiate with the city to pay your insurance company deductible etc.

The city will blame any watermain break in winter on weather. Just as they did with the tree falling on my yard. No coverage. It was the only tree that fell on the street and was clearly at risk / should have been dealt with years ago, but it was visibly OK, not diseased etc. so not under active management by the city. No liability.

https://www.toronto.ca/city-government/ ... od-claims/

In my case it wasn't worth filing a claim with my insurance. On top of the deductible, your premiums will go up 10% or more per year, reducing back to 'normal' over 10 years. So $100, $90, $80 etc. per year extra over 10 years meaning about $500 extra in premiums assuming $1000 annual / 10% increase reducing to 0% over 10 years.

$500 + the deductible was \over the $1500 I paid to have the electrical service repaired so it wasn't worth it in my case.

Naturally a full basement gut is going to cost WAY more than your deductible and increased premiums so it's worth the hassle.
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Mar 29, 2008
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Had the same thing happen to us at a former home. We called insurance co, paid the deductible, insurance co had the basement fixed to exactly what it was before the water damage, they dealt with the city, and eventually we even got our deductible back.
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Jan 28, 2007
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Jerico wrote:
Feb 11th, 2019 8:35 pm
Water damage was reduced significantly after the sewer backups a few years ago. Hopefully water main breaks are outside of that.
Slightly off topic but, worth expanding ...

New insurance quotes will ask you if you have a sewer backflow preventer installed. Newer home construction has started using them pretty much everywhere, and even mandatory in some municipalities.
It's a devise that closes if it senses too high a water level in your sewer.

Sewer Backflow Preventer

If you ever have had a sewer backup, you may want to look into getting one installed, as your insurance should give you a discount for having one now.

I know on my new rental property, it was one of the top first questions they asked when getting a quote.
I'd rather be outdoors camping, kayaking, and mountain biking ...
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Aug 29, 2011
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Would an insurance company consider a water main break "overland flooding"? Generally insurance will cover sewer backups but not that unless you specifically pay for that coverage.
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Jun 26, 2011
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boneca wrote:
Feb 11th, 2019 6:13 pm
We want to hire our own company to do an estimate because we have heard stories that they will quote really low for renovations. We also spent the last two days cleaning, laundry etc. Can we claim our hours? Can we use our own renovation company? We took tons of video and pictures beforehand and the fireman gave us a city claim number as well. We have never dealt with insurance before so are there any suggestions or tips?

Thanks.
It really doesn't matter what the 'really low quote' is, because essentially the insurance company has someone fix your basement to the state it was before. They do not give you a 'really low quote' and just give you money to fix it. So it really doesn't matter what the estimate is. You can choose your own renovation company, but it's not really needed. The reason is that the insurance company may have contracts with independent contractors who are willing to fix the damage for $x. The contractor may do the renovations at a cheaper cost because of their contact with the insurance. Your own renovation company has no such incentive, and may charge $xxx. If there is a huge difference between the two, there's no way for insurance to know you're not also trying to upgrade your renovations while you're at it, so you would be responsible for the difference.

Your home insurance insures you against damage to your property - your time to clean is not physical damage to the property. In fact, as a homeowner you are required to try your best to prevent further damage to your house. Think of this as regular cleaning and maintenance you would have to do to upkeep your house.
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Dec 27, 2011
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boneca wrote:
Feb 11th, 2019 6:13 pm
We also spent the last two days cleaning, laundry etc. Can we claim our hours?
If you tell this to the adjuster then there's a good chance they'll "pay" you for the work you did, meaning they'll deduct the labour from your deductible. So instead of paying a $1,000 deductible you might just need to pay $400.
kmarcie wrote:
Feb 12th, 2019 11:11 am
It really doesn't matter what the 'really low quote' is, because essentially the insurance company has someone fix your basement to the state it was before. They do not give you a 'really low quote' and just give you money to fix it. So it really doesn't matter what the estimate is. You can choose your own renovation company, but it's not really needed. The reason is that the insurance company may have contracts with independent contractors who are willing to fix the damage for $x. The contractor may do the renovations at a cheaper cost because of their contact with the insurance. Your own renovation company has no such incentive, and may charge $xxx. If there is a huge difference between the two, there's no way for insurance to know you're not also trying to upgrade your renovations while you're at it, so you would be responsible for the difference.

Your home insurance insures you against damage to your property - your time to clean is not physical damage to the property. In fact, as a homeowner you are required to try your best to prevent further damage to your house. Think of this as regular cleaning and maintenance you would have to do to upkeep your house.
Some companies will actually give the option for the insured to take a cash out so they can get it fixed themselves. For example if the insurance company quoted 12k with their contractor, they'll also offer an option for a 10k cashout. The 10k is less than the 12k because the 12k includes profit for the contractor that needs to be taken out so that the insured himself does not profit from his loss (which goes against the principle of indemnity in insurance).

OP may also be able to get his own contractor to do the work, but the insurance company won't pay higher than what they quoted with their own contractor and the cheque will be made to the insured's contractor.
Newbie
Feb 8, 2019
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You can claim your time, and insurance adjusters will offer 3 scenarios
1 they fix and warranty the work
2 you provide a quote and they will not warranty work
3 they offer a one time cash pay out for you to fix

They do buy outs on items as well.
all based on value/age/etc..

Just went through this last february......5 weeks after we finally finished a 18 month basement reno........ at least we enjoyed new years in it :P

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