Check your Homeowners Insurance Policy for a water damage limit! We are seeing $10,000 water damage caps with many homeowners insurance companies now. The first company in Florida to add the $10,000 water damage limit to their policies was Citizens Insurance. Then, soon after, many homeowners insurance companies started adding this dreaded water damage cap. If you have Citizens Insurance, the way to avoid the $10,000 Citizens Insurance limit, is to opt into their contractor (MRP) program. This means you will have to use THEIR workers to repair the damage to your house. This means you lose the freedom of using your own contractors. This means if you disagree with the scope or value of your damage, you may end up in mediation or appraisal, and you will probably be in mediation or appraisal without any representation because many public adjusters do not handle Citizens claims. If I was a higher-up working at Citizens Insurance, I’d give that worker a big raise. They found a way to limit payouts, control the people who do the work, eliminate pubic adjusters. Furthermore, if you think their policy and their strategy is unfair and you want to try and sue them, well guess what? They are immune to bath faith lawsuits.
So, what do you do?
If you have more than $10,000 in damage to your house and have a Citizens policy, your best bet is to opt into their managed repair program. If you don’t, you will be limiting yourself to only $10,000 for repairs when this will not be enough to complete the repairs. About half the people I have spoken to are not happy with the outcome of their claim when they use the managed repair program, but you don’t have much of a choice. The main reason Citizens Insurance added this to their policies was to control the scope of work and the cost of the work. Hypothetically you might have $50,000 in damages but when the insurance company hires their own contractor, they can get the work done for much less. They do this by controlling and limiting the completeness of the repairs.
What Happens When The Insurance Company Controls The Repairs?
An example of this is a recent claim of mine. My client had a bathroom leak and there was water damage to the door to the bathroom including the casing around the door. Well, the insurance company agreed that the casings and door were damaged and agreed they had to e replaced and re-stained and finished but did not agree it was necessary to match the other doors and trim in the house with the same hand-stained and finished trim. So, what the homeowner was left with is mismatching trim work. Not fair to the insured and under the basic rules of indemnity, the insurance company denied the insured of his basic rights under the policy. The purpose of the insurance is to bring the person back to pre-damage status, and this example leaves the insured completely mismatched. It saved the insurance company money, but the insured suffered.
How Bad is a $10,000 Water Damage Cap?
Since then, a few other companies have followed suit and have put similar caps and limits on water damage. It has been challenged and the water damage limit is legal. Not all companies give you the option of $10,000 limit or use their contractors. Some companies will put a hard limit on water damage with no option to have the insurance company’s contractor do the work. It’s just $10,000 in coverage and that is all you get, even if you have 10 times the amount of water damage. Most people do not read their homeowner insurance policy and are only made aware of this terrible limit when they file a water damage claim. Imagine that.
These limits on water damage can be a disaster. Let us take a look at your claim to see if there is anything that can be done about it. There may be some options for you to extend past the $10,000 water limit. You need an expert on your side. Call Florida Allstar Public Adjusting, Inc. 954.659.8333
