FAQ: I AM A RENTER AND MY RENTAL HAS WATER DAMAGE– WHO WILL PAY FOR MY DAMAGED PERSONAL BELONGINGS?

3/24/2017 (Permalink)

What happens to a renter's personal belongings when a water damage occurs?

SERVPRO of Downtown Long Beach Recommends Renter’s Insurance.  Here is why.

Operating our restoration business in Downtown Long Beach presents us with the complex world of working on water damage or fire damage in Multi-Unit or High-rise properties. Let’s give an example of all the players that can be involved in a water loss at a 4-story condo complex with 2 units being affected by the loss. Here is the setup:

• Rita rents Unit 1 on the first floor from her landlord Lucy. Owen lives above Renter Rita in Unit 2 on the second floor and he owns the property. At 2:00 am on a Saturday night, Owner Owen’s toilet starts to overflow.   Owner Owen doesn’t get home until 6:00 am, at which time he discovers the water damage. He shuts off the supply line to the toilet (which actually work because he is a good homeowner who replaced them last year) and calls Renter Rita. Renter Rita answers her phone, telling Owner Owen she is on her way home from the airport after a redeye flight and in no mood to deal with this situation.
• When Renter Rita gets home, she discovers that the toilet water has saturated her bathroom and entire closet full of clothing. Renter Rita calls her Landlord Lucy in tears to give her the news. This is when Renter Rita finds out that her Landlord Lucy is not responsible for any of Renter Rita’s personal belongings. Landlord Lucy says, “Renter Rita, I told you to get Renter’s Insurance when you moved in!” Renter Rita starts to seriously panic at this point. She has a big meeting tomorrow with nothing to wear, not to mention she is already exhausted from her business trip. She starts to soak up water with towels, which does little good but she doesn’t know what else to do.
• In the meantime, Landlord Lucy calls her insurance hotline and asks a lot of questions. Landlord Lucy’s next call is to Owner Owen to yell at him, letting him know that he is responsible to fix her unit and pay for Renter Rita’s stay while the work is being done. Owner Owen tells Landlord Lucy to calm down, mentioning that neither of them is responsible. Alas, Owner Owen has reviewed the CC&R’s, which state that toilet overflow is covered by the HOA, with a few exceptions that they can work out later.  
• At this point Owner Owen and Landlord Lucy start a 3-way call with HOA President Horatio. HOA Horatio is not a morning person, so he tells them that they both need to file their own claims immediately, including Renter Rita if she has insurance. HOA Horatio explains the HOA policy covers only part of the claim, and the final responsibility is worked out at the end of the claim between the insurance carriers. The HOA is required to meet to discuss the claim once it is determined who is responsible for which parts of the claim. This could be a month or more out. If they don’t call SERVPRO of Downtown Long Beach, their preferred Water Mitigation vendor,
  ASAP, then the claim price will most likely go up since the damage gets worse the longer the water sits.
• Owner Owen and Landlord Lucy hang up and call their insurance carriers back. They too are told by their insurance hotline that SERVPRO of Downtown Long Beach is their preferred vendor. They decide to make separate claims and call SERVPRO.
• Before they know it, a friendly SERVPRO of Downtown Long Beach team is on site, taking measurements, setting up equipment, and moving affected items aside for assessment.
• While the SERVPRO team is working, Renter Rita calls her insurance carrier, still in tears, hoping for a miracle. Mr. Insurance places her on hold for several minutes while he reviews her policy. Renter Rita bites her nails, waiting impatiently for them to give her the news. Mr. Insurance gets back on the line to tell Renter Rita that, Yes! You do have a renter’s policy. It turns out her local broker added it at her last renewal, per her request. Renter Rita works so much that she sometimes forgets all the ways she sets herself up for success. She was thrilled to find out that her policy covered her damaged clothing. Mr. Insurance issued Renter Rita an emergency check, as outlined in her policy, to buy a few items while her damaged clothing is evaluated for restoration or repair by the SERVPRO of Downtown Long Beach team.
• A month later after the repairs are all completed and all affected parties are settled, Owner Owen, Renter Rita, HOA Horatio, and Landlord Lucy meet up at their local wine bar, to catch up and laugh about their big fight. The HOA ended up covering part of the claim and their personal policies covered the balance. They say a group “Cheers!” to their insurance carriers.

• This story could have ended very differently if all parties were uninsured or underinsured. Here are some helpful tips:
  • Make sure you understand your coverage.
  • Spend time with your agent asking questions to ensure you fully grasp what is and is not covered by your policy.
  • Go through different made-up scenarios with your agent to find out what your coverage would be in different situations.                                                    
    • For example, “What if I left a candle burning and there was smoke damage in my apartment?” Or “What if my neighbor’s refrigerator line leaked and ruined my ceiling?”
  • Take the time to review your coverage if anything changes with your property or living situation.
  • If you are a renter purchase a renter’s policy. If you are a landlord, encourage your renters to obtain a renter’s policy.
• Moral of the story – insurance is part of our daily American life. Set yourself up for success by purchasing an insurance policy that fits your needs.

Water Damage at your Rental Condo, Multi-Unit Property, or High-rise? We are ready to help. Call SERVPRO of Downtown Long Beach, Lakewood, Signal Hill at 562-591-1788.