Title: Homeowners Insurance Secrets: Water Claims, Coverage Gaps & Legal Must-Knows
Downloaded: 2025-12-30 08:53:19

[Music] Welcome back to another episode of the Auto Accident Attorneys podcast. I'm your host, Attorney Ali, and it is sponsored by the Auto Accident Attorneys Group. We take care of you. Today we have returning guests, attorney Rishi Patney, Patney Law Group, and attorney Holly Cole of the Auto Accident Attorneys Group. Welcome back, guys. Thank you for having us. Good to be back. I just realized reviewing some of the prior podcast, I tend to pause because I growing up, I I used to say um a lot and so in in an effort to stop saying um, I would just stop.

But listening to the podcast, I realized I speak like this robotically. Yeah. I also didn't know that about you growing up. That's funny. Yeah. I was also very shy. Did you know that? I did know that. Yeah. That's why I did standup comedy to get out of my show. Wow. That was like really late in life. I know. Better late than never, I suppose. Well, you got the perfect podcast voice for like AI. Yeah, AI. That's a good one. Yeah. You can't tell if it's me or AI. I guess the listeners will never know. Well guys, I appreciate you coming back again today so that we can review homeowners insurance policies.

Again, we're not technically going to review any policy, but just going over homeowners insurance. Um, we do a lot of auto stuff. And if you guys remember, if you watched part one of this episodes, I guess this is technically part two, it's on a different day, but my 11-year-old flooded the master bathroom. Uh she wanted to draw herself a bath. Started filling up the filling up the bathtub. Uh it was taking a long time. So she decided to go lay down for a minute and wait for it to fill up. She falls asleep completely.

So this thing runs for 90 minutes, fills up, floods the entire bathroom. The master bath is above the garage. So the garage ceiling comes tumbling down and the garage is flooded. And to date, this is down two weeks ago. Yeah, to date we are still dealing with the well the drying is done but they're doing some mold remediation work that time the homeowners a review of homeowners insurance policies would be would be fun. One thing I've learned through this process is uh what was it called Reishi? Endorsements.

Endorsements. So just how in auto accident policies we're talking about collision coverage, comprehensive coverage, uninsured motorist, for homeowners policies, there are end various endorsements. And I had never looked at homeowners policies before. It's because with with homeowners, you've got various types of things to protect against. You're you're protecting an asset, right? versus um with auto there there's a lot of um you know liability is pretty much the same across you know every state you know what what makes you liable for for things with with your car um you know there may be different ways that you are liable but the indemnity provision runs the same.

The difference is when you've got homeowners the policies the premiums are based on the types of risks for damage to the property. Each one of those risks are are unique and have their own category of you know how how they formulate financially the premium that that you that you end up paying and that really depends on where in a big factor where you live um specifically geographically and naturally what types of of hazards you're going to encounter. So you know we we're not likely to have um roof collapses from snow in Georgia.

We we just don't get that kind of snow. So you know our policies don't you know they may have coverage um for that in a different state you know with the same insurer their standard policy in like say Alaska or Washington state Colorado might have that kind of coverage they don't have to have that coverage in in Georgia so they they may exclude it unless you want to have you know specific risks that are you know outside of your your normal Georgia exclusion that you want to insure for and that that's why they do it by endorsement as far as endorsements go if if you want to prepare where, you know, on this podcast, we like to take care of people.

We give them information. As far as endorsements go, if you're looking at policies ahead of time, what sorts of things are you taking into consideration? And what endorsements do you look at ahead of time before you need a policy? So, so this is where a having a good insurance broker, a knowledgeable and and vetted insurance broker really does help because most consumers, they don't um they can't foresee all the various risks. But a a broker that's been um helping people in that community get policies has seen the various types of risks that that people insure against and um and and they're pretty well verssed on what are the classic risks that we have to have um that that banks require certain coverages for and and and banks are pretty good um because your home is their security for your mortgage.

um they're going to make sure that when they have an insurance requirement, they're going to require that you insure it for those various risks that keep their security asset safe. So, that's a good point. If you have a a a buddy who's an insurance broker in Colorado, they might not be as helpful to tell you what to look out for than somebody in Georgia, if you're if you live in Georgia, right? Because they have seen what sorts of claims have been made in the prior year, prior two years. They're just more accustomed to to sure what to look out for.

Yeah. In that sense, it's always better to have you can always get advice from from people outside um and then they can walk you through the process, but what it's actually when it comes to selecting the types of endorsement that you want on your homeowner's policy. It's it's definitely good to to consult with someone that's been doing it locally for a while. I wanted to piggyback off of this topic because Rishi said something that's applicable across the board across industries and that's consulting with somebody who has seen all sorts of situations and they can speak knowledgeably about that topic and I think that kind of applies also to what we do um in personal injury when you you could probably DIY your case for example but it's invaluable to have somebody on your team who has seen all sorts of situations play out and they know how to handle it.

And that's, you know, and I think it's funny as attorneys, I'm sure we get questions from friends and family all the time about it runs the gamut, right? Like criminal law, employment law, and things like that. And there's a handful of things that we have learned in school and throughout life, but we're not experts in those areas. And even as attorneys ourselves, we will hire other attorneys in other fields because they have seen, okay, practically how do situations play out. How many times did you guys realize this?

As soon as you got into law school, uh within that first year, you start getting calls from friends that are describing a a Friday night drunken um you know, situation. Somebody somebody gets arrested. Oh, this was this was every single weekend. I would get calls from Atlanta while I'm in law school and it's friends that or or um you know friends of relatives um you know hi Richishy I'm your brother's friend and uh and we were out on Friday night and everyone was cool but there was just this one police officer and the situation got out of control and then somebody you know drunkenly said something and then they try to run and um so what do we do now now he's in jail and and you're in law school and I'm like unless it deals with contract 101 and I'm still I'm still trying wrap my head around the rule against perpetuities.

I can't help you. What is consideration? Exactly. You're like, well, I I don't know about the arrest, but if an interest does not pass in a person's [Laughter] lifetime, you're working on civil procedure. You guys are right. I do remember getting calls. Um, one specifically said, uh, well, they asked me how much the fine is for a speeding ticket. I was like, I don't know. He's like, "Well, you're going to law school. What are you going to law school for?" Yeah, exactly. They're teaching us in law school. That's some attorney you're going to be.

But to take it back to entrance, if you were to ask a friend who is an insurance broker in Colorado, well, how do I deal with, I don't know, something that we deal with in Georgia that they wouldn't know about? If they don't know the answer, it doesn't mean they're bad insurance broker. It just means, hey, I haven't dealt with this. This isn't my specialty. You should probably find somebody in your area. For sure. Yeah. It's interesting the more I learn about our own specialty, for example, you because you said we hire other attorneys.

I've never paid for more attorneys in my life than like the last two years for different not because of just criminal defense, but but as even as a business owner, you start learning the value of of other other people's expertise and relying on that. Um, and that has value when you're when you're looking at it's a decision that you don't have to, you know, there's there's a lot more reassurance and comfort in making a decision as a business owner when it's informed by people that um have knowledge, specific knowledge in that area.

Um, you you're just more confident in the decisions that you're making as a home as a business owner. Absolutely. Even on our cases, cases that you and I are currently working on together, setting up estates, right? You know, it's we're not going to do that in house. We could. Exactly. I mean, is is it possible to go through all the work and teach yourself, you know, that area of law? Sure. I mean, it it's possible, but it detracts so much from your daily operations for this one specific project. It it it makes economic sense to use outside counsel or separate counsel that that you associate for that one aspect of a case, such as setting up estates.

And tying in when you said people that have experience, for example, it's all legal work. We could do the legal work, but some little nuance or wrinkle comes up like somebody's relative is incarcerated or somebody's relative is in uh another country and you can't deal with it. Well, that would be the first or let's say even third time we're looking at it. But when somebody does this for a living, they see it, they go day in and day out, they already know what to expect ahead of that. So, it's worth every penny.

I guess we we give a shout out to Burke Johnson over at Lutter Larkin. There we go, Burke. You're fantastic. Shout out. Tying it back into homeowners insurance. Uh because I I do want listeners to to get something out of this and and hopefully review their policies the way I I ask people to review their auto policies. Go ahead and review your homeowners policies as well. Uh, I think probably in Georgia the biggest thing anyone's going to deal with is water intrusion. Now, ours was based off of I guess we could call it user error and and by user error I mean I had an error in having children.

I'm just kidding, sweetheart. I love you very much. I don't know. She gave me a hard time at dinner last night. I think I think I it's it's a little Yeah, she'll appreciate it when she's older. Hopefully. It's a valuable lesson. Don't mess with people that have a platform. Amen. Water intrusion from from exterior water intrusion. Uh, one thing that I learned was that if it depends on how the water is coming in, if it if it was a in auto accidents, we talk about acute trauma. So, if the injury happened because of the accident, well, if the leak happens because of a specific cause like a storm that like blows the shingles off or or creates an uh holes and water comes in, that's covered the the replacement of the the product, the shingles, the roof, as well as the damage that it causes.

But if it's a maintenance issue, like if there happens to be a hole in your wall or a chronic condition on your roof that leads to a leak, the water damage will be covered by your homeowner's policy, but that replacement or fixing the material will not be. Wow. I thought that was really interesting. Yeah. Well, don't leave us on edge. What happened with your policy? Oh, well, our leak was starting from inside, so everything is covered. Okay. Everything's covered. Um, which it's kind of crazy to think about that an 11year-old has got Oh, by the way, it is so much more expensive than I thought it would ever be.

Oh. To replace a bathroom. Oh, you have to replace the whole bathroom. Yeah, because the whole floor has to go. But it's probably because because you've compromised all of the the floor joists and everything, the subfloor, everything. You had custom vanities. You had everything was down to the detail custom. What's the replacement value of that standard or That's what we're waiting to see right now. We had an adjuster come by and review everything. Um, the remediation company has their own contractor and they gave a quote of what it would cost to rebuild.

Now, there was one difference. We had marble floors and they're going to replace it with porcelain. I don't know how I feel about that yet, but I'm trying not to even I've got enough to think about just on this platform. So, I'm leaving it up to to Jamie to figure out what she wants to do with that. But they gave their estimate to the adjuster and the adjuster is going to come up with his own estimate. I'm sure he is. I I asked I was like, "Well, if we what happens if we decide that we don't want to use this particular contractor, we get another contractor and that contractor comes by and says, "Oh, well, they had it all wrong." you're you're actually getting into exactly where the vast majority of of people's litigation um you know when it comes to their homeowners policy and um and it's always the uh the part where you you've suffered a loss um to to the insured property and uh and it is always this back and forth between what is the value of restoring and and what you know there's always a disconnect between what insurers are willing to pay for repair and remediation versus what the homeowner wants.

Um, and and a big part of this is knowing what your policy says about when you have to act. Um, if if you decide if your homeowner uh if your insurance either decides that it this is not a covered event and and you disagree or we're not we're not covering the full amount of of this loss and you believe that more should be covered, there's things that um that you're still on the hope for that they're saying is not covered. Um so this is where a lot of um when people get sideways with their insurer and and there's a claim for the way that they've adjusted it.

Something that is really critical for you to know as a as a policy holder is what your policy says about when you know when you are allowed to sue the insurance company, your insurance company for um a a dispute over coverage under that policy. um and it's basically they're called exculpatory provisions and they vary drastically from policy to policy. So in the few homeowner um claims that I've had, I've seen ones that say from the time that the loss occurs, you have one year from that date of the loss to bring suit against us, which means we can continue to negotiate back and forth, but that date is not waved.

And so you can think that you're negotiating with your insurer and they're they're moving a little bit and you're moving a little bit. You're trying to come to a consensus and the time for you to actually file suit can expire during that and um and then you realize you've lost all leverage. Um you you have to accept you have to accept whatever they give you because you don't have the ability to sue them over um a dispute over the contract. So, knowing what your insurance policy says in terms of exculpatory provisions, it's um it's critically important to know when you have to act and when you have to consult with an attorney because you're you're kind of at odds with your insurer on a covered claim.

So, they're essentially setting their own statute of limitations by contract. Absolutely. And and Georgia does enforce them. What's the shortest timeline you've seen? Um one year, 12 months. 12 months from the date. You got tired. Yeah. Oh, I'm not worried about myself. That was information. You think I can go 12 months without my Toto? That I miss the Toto so much and I'm so mad that I didn't install one downstairs. Is Is that the uh the the Japanese toilet with the bedet? It does everything. What? It's got a blow dryer.

What? It's got a warmer. That That is That's That's how you know Japan is playing chess when we're playing checkers. I mean, toilet toilet technology is a a sign of it's all downhill after that. I mean, we're at the we're living in the golden years of toilet technology. Yeah. I got to tell you, when I when I walk into the office bathroom and like I'll see the the toilet lid up just in my mind, I'm just like like what what are we the Flintstones? This is this is ridiculous. so univilized and and to use a cold toilet to sit on.

Oh my goodness. For real. In the winter and then having to touch. Now we have a button on the back of of the one in the office, but even having to touch it, it's I think it's a Neo Rest. Oh, I don't remember the number. There was a point in time where I knew all the stats where when you when you approach it's got a sensor and it will lift the lid and then it will it's got a light on the inside so if you go at night you can see where you're going and then it gives you like a little it's not a courtesy flush it's a courtesy spray out of the bedet portion so there's like a little bit of like moving water and then you sit down.

All it needs is like a little slide out with like a magazine or I guess these these days people don't read magazines but you know. Yeah. So, but pull out your iPad tablet. Exactly. Give you some entertainment while you're here for the next hour. During winter, uh, you can find Ju Guu sitting on it. She's not even using the restroom. Just It's warm, so she likes to sit on it and you could control the temperature, so she turns it up. I don't know how we got ended up being a Toto commercial. Exculpatory clauses.

Ex. Yeah. I it's a big problem for for homeowners that that find out that the time for them to actually bring suit when when they're in a disagreement over what's what's covered. Um yeah, that that exculpatory provision has caused a lot of headaches for homeowners because it was something they didn't pay attention to. And and for most homeowners, the only time that you've ever thought to look at your policy all the way through is when you first receive it. you receive a PDF that's like 40 pages or 50 or 60 pages um from your broker and all you care about is what do I have to pay?

What's my premium, right? And um and ultimately so and that's at the very very front uh that that's on the first like five pages. Um all of the terms and conditions and all the various exclusions that comes much deeper into the policy and so if you haven't flipped through it uh you could be in for a rude awakening when it's time to actually consult that. Yeah, it's always when you're actually going to use the policy, the language, the escape language that lets the insurance company off the hook or if I guess to have hear them frame it, they'll probably say, "Well, that's not a a covered loss." It's always buried absolutely in in that fine print strategic.

And they usually do them in like uh they're like columns, right? Yeah. It's one or two or three columns on each page and you got to go through and like the sections are on different pages. It's even as an attorney, I hate reading those things. Yeah, reading headings are very helpful and understanding in in any contract that there's going to be boilerplate language. It's pretty standard stuff. Nothing that you're probably going to be concerned with, but there's always those specific clauses, the specific sections, paragraphs that you want to look out for.

So just just skim if there's a table of contents or headings, skim those, find the one that sounds like it might be the one to screw you and then read that. Which in all likelihood is all of the clauses. Well, if it's insurance, probably the the way that they're written um they have a broad coverage provision, then they have all of these exclusions, and then they have exceptions to the exclusions, and then they have exceptions to the exceptions to the exclusions. And so try and trying to weed through that.

Yeah. I mean, you have to literally diagram it out. Yeah. I mean, I I've there are times when I'm trying to figure out whether or not um a certain client's loss is covered and whether or not it falls within exclusion. You're actually drawing it out and saying, "Okay, so the policy covers this." You start off with one and by the end of it, it looks like a beautiful mind. Like you got sketches all over the wall. Yeah. Lines drawn all over the place. I'm You said beautiful mind. In my brain, I always I'm thinking of the uh Always Sunny in Philadelphia, the red lines.

It's exactly that easy. I like to imagine that on the insurance company side because I'm like surely it's not that confusing for them. It's like just a list. No, no. Yes. They want they want to give the illusion that no, no, no, we're going to offer this to you, but if you look at the exception to the exception to the exception, this actually isn't covered. Yeah. What was interesting about the adjuster that came by? Um, I was talking to him and I had a ton of questions. First of all, how dare you? He laughed.

He asked if I was an attorney and I I explained it to him and he laughed. He's like, "My brother's a personal injury attorney." I was like, "Oh, that's interesting. I want the two of you to come on to the podcast and have a discussion." But I'm I'm really curious. I guess now that we're having this conversation, I'm going to have a part three to see how this actually resolves cuz I'm really curious to see what this guy approves. Yeah, me too. On on the replacement cost. This is like its own series in itself.

I believe that we're framing it in such a way where listeners hopefully get something out of it and if they heed the advice, go and and look on the front end and check your own policies and and see where your your coverage may be lacking. You think you'll still get All State or State Farm to sponsor this podcast? We may have. That ship may have sailed long ago when you started with series one. Yeah, actually I'm pretty sure uh for All State specifically, it was when I lost my temper on a recorded phone call at an adjuster.

Who hasn't done that? Uh they're quite not quite as bad as progressive where uh had some choice words that involved uh recommending that somebody do something volitionally with a bat sack full of um male genitalia. You told someone to eat a pack of dicks. I wonder if that makes it in the podcast. I did. I did. See, fighting zealously for your clients over here. Sometimes it's it's just it's so unreasonable. You can't help it. you're like, "Oh, you want to be professional." And obviously they're just doing their job even though their their job is is the devil's work.

And they they've just they've drank the Kool-Aid, but uh certain days um are worse than others. I have shorter fuse on certain days. And he caught me on the right one that day. I had time. Way to go, Voldemort Mutual Insurance Company. There you go. Yeah. Rishi, let's uh talk about real quick what obtaining an attorney looks like for a homeowner's policy. So, on the auto side, we have contingency, right? Right. So, what's it look like for somebody that may be listening right now and they've got an issue where they think that their claim is being wrongfully denied?

So, it it comes up quite often because this is where um even for attorneys that do contingency fee work, plaintiffs work. Um it is hard to do it um to have that same fee structure when it comes to homeowner claims because you've got um you you don't have the types of damages that are are kind of open to, you know, the jury's discretion, right? They're when it comes to property, it's pretty kind of black and white. They're all what you know what I like to call invoiceable damages, something that you've got a receipt for quantifiable.

Exactly. And th those pecuniary losses are, you know, those are actual monetary losses that are the cost of repair, the cost of remediation, the cost of, you know, temp, you know, and then all the consequential or incidental things that come as a result. Um, you know, having to move into a hotel for a while, um, having to replace clothes, things like that. All of those, it's kind of like, you know, when when you've got a car accident, you're getting your car repaired. You know, how how long are you going to cover the rental?

And there's limitations on that even in your homeowner's policy. Well, there's similar types of limitations, but at the end of the day, the recovery is still for the value of the asset. And so, when you do a contingency fee on something like that, the homeowner is almost guaranteed to never be be made whole. And so, it often has to be done on an hourly basis. And and and you you try and be as reasonable as possible, understanding that that folks are trying to to just get recover from their insure an amount to replace the, you know, the asset.

And if they, you know, at some point it becomes a pure victory if if you've paid the same amount in attorney's fees, right? The reason contingency fee doesn't work is because you're saying win or the award is the amount of the property damage. Exactly. So if you build in, let's call it a 30% contingency fee on on the award. Now the homeowner is left with not enough money to replace the property damage after after an absolute win. their best day is only recovering 70% of the value, right? There are exceptions.

I mean, there's times when um you know, you can get if there's a bad faith component to it. Um and and you've got um you know, an attorney's fee or fee shifting. Um now that of course that has changed a little bit with tort reform and and you're very limited into in how attorney's fees can be recovered but um you I don't think tort reform has evviscerated all contractual damage like attorney fee recovery uh provisions and there there is an exclusion for contractual um fee shifting where you know if if attorney fees are recoverable.

So that's something else that you want to check your policy where to make sure that they don't have a provision in there that excludes that. I I imagine post tort reform it might be something you'll start seeing in Georgia homeowner policies. I wonder how many insurance policies will permit loser pays. Yes, exactly. I am curious uh to see what happens with our bathroom. I do miss the Toto. I really appreciate both of you joining me today and talking through this. Hopefully the listeners got something. Don't forget to follow each of us on social media.

Uh, we'll put the tags on the comments section because I don't remember everyone's handles. I do remember that I'm attorney Ali. That's easy. Um, Richishy Pattney. Go ahead, Holly. It's Holly Galately, but the spelling's different. Check the description box. Smash that like button. Hit the subscribe. All of that. Rishi's going to take over. Yes. Everything Rishi just said. I appreciate you guys. Take care. Thanks so much.