Foundation Damage Caused by Hurricane Irma Flooding - Is it Covered?
by Charles R. Tutwiler on 11/13/2017
Policyholders may be surprised to find that their flood claim for foundation damage is denied because the NFIP says the damage is caused by earth movement or settlement; even though the earth movement was caused by flood waters! Before I discuss this, let me remind the reader that each loss is fact specific to each property. You may have two homes or commercial buildings in close proximity to each other and the loss conditions from the same insured event may vary to the point where they impact the claim.
Most property insurance policies have exclusions for ground settlement even if caused by a covered loss. Because ground settlement has been so problematic in Florida over the years, the legislature passed a law many years ago that required insurance companies to cover sinkhole damage, the ultimate settlement and foundation problem. This coverage has mostly been gutted by recent legislative action, to the point where for all practical purposes the coverage does not exist unless the consumer pays a higher premium.
During Superstorm Sandy, clients whose homes clearly had foundation damage due to four feet of water sitting on top of the concrete slab (remember each gallon of water weighs 8 pounds), due to the tremendous weight pushing down on the slab and foundation. In our cases, the resulting damage to the slabs (especially if the radiant heating strips were in the slab) was paid for. In another loss on Long Island, where the dirt washed out from under the slab, NFIP paid to replace the dirt under the slab.
Some claims from Tropical Strom Debby in Florida resulted in our clients getting paid for the complete concrete slab due to hydrostatic pressure pushing up the slab in a dome shape. Flood also paid for patching cracks in the foundation on some losses. In situations where sand was washed away from under the foundation along buildings on the beachfront, NFIP did pay to grout the voids under the concrete slab and foundation.
In matters like this it may be advisable for policyholders to get a structural engineer or public adjuster involved to give an opinion. Sometimes a trained and experienced professional can identify technical issues that an untrained eye will not see to support a flood claim payment.
Remember, the National Flood Insurance Program is a bureaucratic Federal program and we have seen folks get caught up in a red tape quagmire as evidenced by a recent article about lessons learned post Sandy. Officials in Washington write the rules and they can change them if enough political pressure is brought to bear. The people I have worked with in senior positions at NFIP are good, decent individuals who want to do right for struggling flood victims. But remember, Congress makes the rules and the administrators must follow their directives. Policyholders with flood claim issues should not give up. Have a professional look at the loss. Who knows, a different perspective may shine some light on the facts of the claim and result in much needed claim dollars to properly fix the damage.
If you have questions regarding any property insurance related issue caused by Hurricane Irma please call 800-321-4488 or contact a licensed Florida Public Adjuster to submit a question to one of our insurance claim experts.