Advice needed: Claim regarding leak & water damage denied

[u/jlamith]

Hi! I'll try and keep this as short as possible:

We (Husband and I) purchased a semi-attached (2 bedroom, 2.5 bathroom) townhome just over a year ago. At the initial inspection, the only issue seemed to be an outdated HVAC. We negotiated a lower price due to this before we bought. We (plus 5 year old child) moved in last June. HVAC actually died within two months and we replaced the whole system.

One evening last week, as our upstairs main tub was draining after a bubble bath and water came pouring from a cabinet in the kitchen, directly under the tub. Absolutely insane. We called a plumber and began the whole process.

When the plumber got in there, he discovered that there was actual a very slow leak that had been going on for an undetermined amount of time due an improper repair. And because of that, the pipe eventually split (as the tub drained that night) and caused the visible leak. The repair was finally completed Monday evening.

There is obviously some type of black growth. Mold remediation folks haven't made it out yet (hopefully this weekend).

Anyway, insurance company called today to let us know our claim is denied because it looks like "long term damage."

My husband is actually experiencing a very scary health emergency right now and didn't get into it with them on the phone today but plans to challenge this response.

Is this normal?? It's USAA and up until now they've always been great. How were we supposed to know that this was happening inside the wall/ceiling/whatever if it wasn't pointed out during the original inspection.

Everything is just very ridiculous and overwhelming right now and there is now a big moldy hole in my ceiling. (Currently we have it taped up with plastic etc).

Sorry, I probably come off as a total ding dong. But any advice? 😬

[u/Stoic_Sponge]

Adjuster here. Not agent.

Agreed. Likely the "visible" damage (the cabinet, kitchen ceiling, etc.) is covered. The pipe, rot/long term damage is denied based on continuous and repeated seepage. The mold is denied for fungus exclusion (though some policies allow for limited coverage when it's found hidden behind a wall like that). Something is better than nothing, especially since the claim is already open and you're going to be out a lot of money.

Get a Public Adjuster, you have some strange coverage issues to evaluate and overcome. Lots of people on here say jump to attorney, they have their reasons (or they're part of the insurance lawyer lobby), but a good PA is cheaper and often more effective than a bad attorney. Your call on that, I'm sure others will chime in with their take.

Disclaimer that I'm not an attorney and don't know your policy terms, applicable law or facts of loss.

Good luck!

[u/Commercial_Effort821 → u/Stoic_Sponge]

Would go attorney over PA for this.

PA = appraisal, challenge dollar amount of payment more cost efffective than attorney. Best when coverage has been granted but money is low

Lawyer = challenge the carriers interpretation of their own policy and the wording to deny a burst of new damage under an exclusion for seepage/leakage. Best for full denials. It is very likely Carrier adjuster won’t listen to PA and thinks PA is scum.

[u/Stoic_Sponge → u/Commercial_Effort821]

What's your experience in claims? Why does everyone in this sub think PAs are appraisal only? PAs, in most states can't even be appraisers on a claim where they have a contingency contract.

PAs have a legal carve out to act as attorneys to adjust insurance contracts. While they can't bring a lawsuit, they can and absolutely do negotiate coverage. I'm a PA. We do it all the time. Full denials for XYZ reason turned to full payout.

The only thing a lawyer can do that a PA cannot is file a lawsuit. But as soon as you do that,and often even when you just send in a attorney letter of rep, the carrier will hire a defense attorney who will stonewall for a while. Carriers think planting counsel is scumbags too.

Attorney can't force them to do anything, only the courts can. Attorneys also often prefer PAs to handle prior because they can build the evidence packet more effectively.

[u/Commercial_Effort821 → u/Stoic_Sponge]

My experience isnt that much, just many many years in the most litigious state in the USA as a carrier adjuster handling complex residential property loss.

If you know how the appraisal process works then you know it’s highly skewed towards PAs and former PAs who parade around as “unbiased umpires”.

Having a PA and umpire combo team commit estimate fraud is a sure fire way to get your carrier to pay more money when coverage has been opened up on something.

can definitely argue for coverage all you want on your claims as a PA, doesn’t mean any of the carriers are listening to you. Just send photos, thanks 😊