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Thread: House damaged by building explosion nearby

  1. #1
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    Default House damaged by building explosion nearby

    Hello everyone.

    Just wondering if someone could educate me on an insurance situation:

    I own a home that was recently converted to a rental property ( I lived there for years before the conversion ). It is located in an area zoned residential/industrial and had the misfortune of being right across the street from a commercial textile building that exploded violently last week. The blast was focused in such a way that my property incurred massive damage (major structural damage to the dwelling and foundation). No one was seriously injured, which is amazing considering the damage. I have a policy that covers damage to the building up to $150k. If this building is a total loss, which I expect it to be, what will happen? If I just want to walk away from the property is that an option? Is the textile buildings insurance responsible for the loss of income for the rental property?

    This is a whole new world for me and I am a little bewildered. Thanks to anyone with info!



  2. #2
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    Typically when insuring a dwelling there is a discussion about "am I adequately insured?", "am I over insured?", "how much insurance do I need?", etc. Therefore, the expectation is to rebuild and $150k was discussed as an amount adequate to rebuild. If the $150k is less than the cost to rebuild you may consider paying out of your own pocket the cost, in addition to the $150k, to rebuild. If you decide not to rebuild the insurance company will settle the total loss on the basis of actual cash value. Actual cash value is the amount to rebuild with deduction for depreciation. The older the home the greater the amount is deducted for depreciation. It is customary to include rental income in the rental dwelling insurance policy. Contact the textile company for reimbursement if your policy does not include rental income.

    Also, it is possible that zoning and building codes have changed since the home was built and in order to get a permit to rebuild the dwelling may have to be upgraded to meet current codes and ordinances. Unless the policy includes building code upgrade coverage the additional cost to meet current codes and ordinances is not covered.

    Contact a reputable residential building contractor who is familiar with your area and current building codes to request an estimate to rebuild. Also, contact the insurance company for an estimate of the dwelling's actual cash value.

  3. #3
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    Thank you, Motoring. Your response was thorough and well appreciated!

  4. #4
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    Since the cause of explosion was due to the company, are they helping to contribute something to fix your home? It seems like there should be some liability on their end and that you should not have to figure this all out completely on your own.

  5. #5
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    Quote Originally Posted by ttammie98 View Post
    Since the cause of explosion was due to the company, are they helping to contribute something to fix your home? It seems like there should be some liability on their end and that you should not have to figure this all out completely on your own.
    Hi

    I was going to ask the same question. Your property got damaged due to the fault of the company, So are they in anyway contributing to help repair your home?

    ______________
    Loss Assessors

  6. #6
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    No help at all coming from the company. As it turns out, the building may have exploded due to the actions of the owner. The site was investigated by the ATF and they have found evidence that the explosion was intentional. This individual and his company will be of no help. From what I understand at the moment my insurance company will pay for whatever it is that needs to happen (currently looks as though the home will have to be demolished) and they will sue the building owner's insurance company for what it cost them.

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