WHAT! No insurance?

General Real Estate Investing
1

For the first time ever I called to file a claim on a rental unit’s insurance.

We had had a Young Army Guy (YAG) stay in our fully-furnished 1-bedroom unit. He developed some unsavory friends who were hanging about, smoking cigarettes and throwing butts on the lawn (I HATE picking up butts) and generally trashing the place.

We gave YAG notice to vacate. He left, went back home to Mama in Texas but neglected to give us the keys. Unsavory friends then stole flat-screen TV, vacuum, DVD player, linens, antique radio, etc.

I filed claim with National Casualty Company, a Scottsdale Company, after noting that there was $16,000 in contents coverage on that unit.

It turns out that contents coverage is ONLY for fire and volcanic eruption. Maybe also for meteor strikes.

I have had a hard time understanding the policy: “You may use up to 10% of the Coverage A limit of liability of loss for both fair rental value as described in Coverage D and additional living expense as described in Coverage E”.

“This coverage does not apply to property of guests or servants or to rowboats or canoes.”

“Payment under this coverage reduces the Coverage C limit of liability by the amount paid for the same loss.”

Absolutely and purposely incomprehensible policy jargon. So I called the company.

I DON’T HAVE COVERAGE!

Has this happened to anyone else? Theft is covered under Homeowner’s Insurance, but not under Landlord/Tenant Policies?!

Fortunately Mama in Texas is going to mail a check for $1596 so that I will take YAG’s name off the Burglary report.

What is going on here? Anyone with a clue about those hateful policies?

Furnishedowner

2

Furnished,
I pretty much look at our insurance policies as useful for fire and storm damage…that’s about it. There are so many things not covered that it’s really not useful for anything else. The couple times we’ve had trashed out units, we just take some pictures and get to fixing it back up. Normal coverage doesn’t cover flood damage either. We have a couple homes in flood zones where the bank requires flood insurance. We carry a 1k deductible to lower the premiums because I know I’m only filing a claim if the house burns down or is leveled by a tornado. Homeowner’s insurance is different like you said. Your “insurance” on issues like this is having people’s credit cards to charge damages to or knowing enough about them to sue them if you need.
Did you know mine subsidence is a separate issue not on normal policies? Insurance companies have good lawyers and analysts who make the companies good at collecting premiums, but protect them against having to pay out for numerous issues.

3

I will have to look at our policies to see what we are covered for? We did have a water pipe break that leaked, hit a floor vent and put out the pilot light in the furnace. The unit was in between renters. When we came to get it ready for the next tenant we walked into a skating rink. :biggrin I can laugh now. Farmers Union Insurance was quick to send out an adjuster and got us paid quickly. It has been our only claim in 10 years.

randyscott

4

Mama came through with a $1600 cashier’s check, so we are whole again. It is nice that Texans have money.

YAG, Young Army Guy, came back to town but is staying at the Hampton. Why do I know that? Because he had left his essential dog tags and where-to-report papers in our unit. And his cat. His cat is now living in our office and looking for a foster home. YAG can’t keep cat because he is in the ARMY.

I am still going to analyze all our policies and probably quit paying for contents coverage entirely. If we do incur a meteor strike or fire we can use that saved-up insurance premium money to buy new flat-screens and mattresses.
I don’t think we are even covered for lost rent after a disaster, so why pay now.

Furnishedowner

5

I think that you should read the original before you post some random response. :anon