Insurance Denial from City Water Main Break

aerosmithJune 2, 2007

Jan. 24th we reported water main break at 5 a.m. to the city and said water was entering our crawlspace. At 7 a.m. called again to see why no action was being taken. I left messages for mayor and city director. I went to take photos to document. The water superintendent said they were waiting to locate underground utilities before they could dig. I requested they shut the water off. He said it fed the hospital and too many others and couldn't be shut off. I told him they should divert the water to the storm drain at the other end of my property. A few sandbags would have channeled it away from my garage and house. My sump was cycling every minute. The temperatures were below freezing and thousands of gallons of water was pouring down into my crawl. It was after 10 a.m. before the leak was stopped. The mayor came out and assured me the city insurance would cover any damage. I told him my main complaint was the fact they did nothing to divert the water from my house. My entire front yard was a lake. Within two weeks, an inch wide crack appeared in the brick. The concrete garage apron heaved three inches and twisted and cracked. A portion of our asphalt driveway raised like a cake baking. We turned in a claim to the city's insurance. After four months of little communication, they totally denied our claim with no explanation. They never interviewed the city employees. They had pictures of the water coming in and the damage. But, they said the engineering report found no damage and they were denying the claim. They refused to give a copy of the report because it is "work product" and would be used in court. My homeowners is taking over now. We will file a claim with them next week. We have over $5,000 in damage. I didn't know insurance companies operated like this and weren't required to give any explanation when they issue a denial. My guess is they figure a lawyer would cost more than just paying for this ourselves. I am so worn out by the hours I have spent obtaining estimates and keeping a file. I thought if one had proof in black and white, this couldn't happen! Protect yourself! Take pictures and record any conversations for proof. They can still say no and not give any reason.

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Your mistake was not contacting your homeowners insurance company immediately.
They will pay the claim less the deductible and them go after the city.

    Bookmark   June 2, 2007 at 5:11PM
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We did contact our homeowner's insurance right away. They told us to go through the city insurance carrier. They didn't offer to step in until we contacted them about the denial to ask about our options. We have Farm Bureau insurance for almost 40 years. You are right... we wonder what we have paid for all these years. I told my insurance agent that others had commented that they should have gotten involved from the start. I'm glad they are getting involved now. At this point, I'm not getting my hopes up.

    Bookmark   June 2, 2007 at 9:15PM
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"They told us to go through the city insurance carrier."

Threaten to file a complaint with your state insurance commissioner against your company for failing to represent you.

    Bookmark   June 3, 2007 at 6:12PM
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Municipalities that charge water and sewer rates are responsible for damage resulting in lack of reasonable upkeep.
Hire a lawyer, there was a ruling in the 90's that stated towns and cities no longer had the right to ignore or dismiss damages resulting from lack of maintenance on town or city lines. Prior to that, the first "shot" so to speak was free and after that you had a legal leg to stand on. Just have your lawyer pull up the Vermont ruling done by the courts. Other states have to abide by it also. All municipalities will attempt to deny claims and hope you do not bother will legal legwork. I spent nearly nine years to see this ruling passed.

    Bookmark   June 4, 2007 at 5:31PM
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My insurance adjuster came out today. He expected the letter of denial to state there was no negligence therefore the damage wasn't covered. It just stated there wasn't any damage from the water main leak. He thought that interesting since the damage exists. I told him I felt it was negligence not to prevent any further water entering our crawlspace once the leak was discovered. I did make that request of the city officials. To hire a lawyer would cost more than paying for the damages. My homeowner's hasn't denied the claim yet. But, at this point, I'm not optimistic. I will call a lawyer to get an opinion if my homeowner's denies any responsibility. What would constitute reasonable maintenance on underground water mains anyway? Thanks for the comments.

    Bookmark   June 5, 2007 at 1:18AM
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Not a lawyer or a pro at this, but I would think pressure tests on the lines would be expected. Also part of your statement was that they neglected to put up a barrier to divert the water once the main broke. That is a reasonable expectation.
It rather sounds like they did not pay too much attention to the water you had the problem with. Your expectation is, you pay a water bill and you also pay a sewer bill, by paying these bills you have and so does everyone else, an expectation of these lines being maintained. The Supreme Court also has this expectation. I am not going to be able to spell this right, but a precident has been set by the courts that states, in essence, that by paying the water and sewer services you have a right to expect maintenance on these lines, preventative work. You might be able to find the ruling on law if you did a google seach on law.
The way the laws were written before this was so far fetched, for example, if a town plow ran into your house, if it was the first time the town was exempt from paying damages, only if they did it a second time and you could prove it, would they accept liability.
Again, you are paying for a service and the law says you have an expectation of routine prevention to keep something like this from happening. Try the google search, and I will look also. I have packed away all the documentation regarding this and I will do a search as well. When I find it, I will attempt to email it to you so you can print it out and take it in to the town and see if that "cuts the mustard".

    Bookmark   June 5, 2007 at 3:38AM
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I have just sent you an email with the document number so you should be able to pull it up and print it for your insurance adjuster and a copy for the city as well. If you cannot locate it, don't worry, your insurance company will be able to.
Good luck

    Bookmark   June 5, 2007 at 4:27AM
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I accessed the document by getting a free 24 hour law search site. You had a long fight! It was interesting to read. I don't think maintenance of sewer lines would apply to water supply lines. I haven't heard from my homeowner's insurance yet. They are on a national list of poor faith practices and poor claims payments.... aahhh. If they don't support us in this, I will be shopping for a new company even though we have been with Farm Bureau IN for 40 years. The longer I live, the more I learn. I am going to pursue this no matter what the outcome. These insurance companies need to be held accountable. My husband has free legal advice through his job also. We will wait for an answer from our insurance first. Thank you! Paula

    Bookmark   June 8, 2007 at 1:45PM
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Unfortunately, I see your insurer denying coverage on 2 fronts. First, it doesn't sound like anything actually happened to the pipe itself...other than breaking. Second, and probably the true denial issue, the water is surface water and thereby considered a "flood" which is excluded by every home policy I've ever seen.

I wouldn't waste you time complaining to the insurance commissioner about your agents advice...unless you truly think he gave you misleading advice. I'm inclined to think he knew that the claim would probably be denied by your carrier anyway. However, once you submitted that claim a record of it will chase you around for 3-5 years...even if nothing was ever paid. I know insurance sucks, but it's the only game in town.

Unfortunately, I think your going to be doing allot of heavy lifting on your own. Take as much free legal advice as possible, and consider hiring an attorney if the damage is as bad as it sounds. Best of luck.

    Bookmark   June 8, 2007 at 4:59PM
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You are mistaken... my policy excludes "ground water" which this wasn't. The adjuster even stated this. It does cover plumbing breaks. This was a plumbing break on our property. But the city stood by and did nothing for hours to prevent damage from this incident. This is negligence! My insurance is surprised by the claim of the city carrier that there is no damage. The damage is quite evident. Just one more example of insurance companies denying coverage just to make you work for it. No explanation for denial is required. The city carrier should pay... not my insurance. FYI- there will be no heavy lifting on this woman's part! We will pay for our home to be repaired if that is the only way it will get done. But we will go down fighting. Wonder why our young people learn so quickly to deny responsibility for their actions?

    Bookmark   June 8, 2007 at 5:35PM
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What are the dollar limits for small claims in your state? That might be the way to go if this doesn't get resolved soon. See a lawyer to find out how best to go about filing a small claim. Then represent yourself (hope you have photos) and take your lawyer's advice in how to do it.

    Bookmark   June 8, 2007 at 7:02PM
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My homeowner's came through and is paying the claim for the brick damage, concrete, and driveway repair. The adjuster said the city insurance had a bad record for denying claims. They felt it would be easier to pay than to fight the city insurance carrier. It did help when I had digital photos of the water pouring down my driveway and in front of the house. Also the crack over an inch wide in the brick wall impressed the adjuster from my company. He found it difficult to understand EMC/Hamilton Mutual's claim that I had no damage related to the water main break. Remember this was in below freezing temperatures and involved thousands of gallons of water. Go figure! At least we only have to pay the deductible.

    Bookmark   June 28, 2007 at 12:06AM
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a similar situation happened to a house across the street that divides our two neighborhoods...we have homes on slabs, not crawl spaces....the city water main that runs under the street his back yard parallels burst one day--water was going as high as 10 ft in the air...flooding the street and the force of the explosion damaged his backyard, in-ground, gunite pool not to mention the water flowing into backyard of several houses close to the took the city almost 3 days to stop the water completely...
the city refused to pay him damages for his pool--his insurance oompany failed to pay him damages because they treated it as flooding damage...
he tried to sue the city but was told that he couldn't...
I am not saying all this advice was correct but that is what I remember from the news stories...
His pool was so badly damaged and he could not afford to repair it at his cost so he had to fill it in...his fence was destroyed as well, needless to say...
We live in TX which may explain a lot of this debacle since I think this state has crummy laws to protect homeowners anyway...

    Bookmark   July 18, 2007 at 1:16PM
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The settlement for this one should be interesting.

Here is a link that might be useful: The car was a new Honda

    Bookmark   July 18, 2007 at 4:53PM
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