Understanding Home Owners Insurance Coverage with Snow and Ice Damage

House Talk - Bend, Oregon Real Estate with Karen Malanga

Do you know what snow and ice damage would be covered by your home insurance policy?

KAREN: Hi, this is Karen Malanga, Principal Broker at RE/MAX Key Properties. This show today is going to be super current because I’ve been out doing home inspections, letting home inspectors in all the way out to Sisters and then on the east side of town, dealing with the snow and ice, etc.

I thought that I would have Allison Glasier back. She’s with Country Financial, and anything that you have when it comes to insurance or financial needs, she’s here to help.

But today, Allison, I’m going to keep you on homeowner’s insurance and what we can all be doing here in Bend that would be beneficial so that if we do have a claim, it’s going to be covered – because I know there’s some tips and some secrets about this.

ALLISON: Sure. Thanks so much, Karen. It’s really a pleasure to be back here again. So funny, I was here with you two years ago and we thought we were having a once-in-20-years storm, and that was two years ago.

Hopefully this isn’t the new normal, but I think that what everyone is learning is, especially when it comes to insurance, this is the time to really make sure you’ve got that relationship with the person you work with so you know what you have and that you have what you need.

So often we come across people who really don’t even know who their insurance company is. Maybe it was put together when they closed their home loan and they have never met the person or the company. They haven’t reviewed the documents, they really don’t know what their deductible is, they don’t know what it’s covering.

KAREN: And how quickly that insurance company can react, too, if you make a call, if you have a leak going.

ALLISON: Absolutely. I’ve come across a couple policies from competitors recently that have a 1% deductible. So if your home’s insured for $500,000, you’re out $5,000 before your policy kicks in. That’s something that – you want to review those documents. I think going into any kind of potential claim situation, it’s really about knowledge and being educated on what you’re paying for and what it’s going to do.

KAREN: Sure. Now let’s get to the nitty-gritty. If you take that snow off your roof… [laughs]

ALLISON: [laughs] This is such an interesting…

KAREN: Go over this again, because it makes no sense to me.

ALLISON: I agree, and I did a lot of research two years ago when we were in this situation to figure out how to properly advise my clients.

What we learned was that the weight of ice and snow is typically covered under a home insurance policy. I can’t, of course, speak to all companies and all policies, but that is what I almost see. You’re going to have that coverage for the weight of ice and snow should your roof collapse or should there be some damage that’s resulting from that.

The irony is that all of us who get up on top of our roofs and try to shovel that off of the roof to alleviate that stress, we’re creating a big pile of snow on the ground. When that melts, it becomes groundwater. If the groundwater comes into your home, that is by definition a flood, which is excluded from your home insurance policy.

KAREN: Unless you have a flood policy, which hardly anybody here would have one.

ALLISON: I’ll tell you, I’ve sold three flood policies in 12 years, and those are to people that have second homes in Lincoln City. [laughs] Nobody in Bend has flood insurance. It’s just not something that we think about here.

I did have people a couple years ago who said, “Okay, let me get a flood insurance policy.” The kicker on that is that there is a 30-day waiting period.

KAREN: Yeah, so that’s not going to work.

ALLISON: It’s not going to work for this storm.

KAREN: What about ice dams? You didn’t address those on the roof. If you’ve got ice dams, that should be covered by your insurance company.

ALLISON: It should be covered by your insurance company, but it is going to come down to the Peril Code.

KAREN: What’s that?

ALLISON: Right, exactly. Not to get too insurance jargon nerdy with you – call your agent and ask them what your Peril Code is, because it will make a difference on whether or not your policy is going to cover the interior based on the damage from the ice dam, or if it will replace the roof also based on that ice dam.

So again, this is where it really matters. For most of us, our home is our biggest asset. To know what you have and to be paying for what you need on that is really key.

KAREN: I had someone text in a few questions. It happens to be my daughter, Kristin Marshall, also a broker with me at RE/MAX and out in the snow showing property right now. She wanted me to ask you, Allison – here’s her first question.

She has a claim right now. There was water coming into her son’s bedroom and through their master closet from ice dams. Her question is: “Since this is my first claim in almost 10 years as a homeowner, will my insurance go up, and do you know how much?”

ALLISON: Ooh, that’s a fair question. The answer is I honestly don’t know, because some companies have a claim forgiveness clause that’s built into their contract. Really, it’s all marketing. All of those companies are trying to pay claims fairly and bring in enough premium to do that.

So it will come down to your company contract, how that plays out, what your longevity looks like. With some companies, if you’ve been with them for five years or something, that first claim is forgiven. It just depends on that specific verbiage.

KAREN: Okay, and her second question: “Are insurance companies going to be covering items like roof heat strips, something preventative so that these leaks and damage doesn’t happen in the future?”

ALLISON: When you say covering, like would we replace the roof strips?

KAREN: Or do something preventative.

ALLISON: I think that we will see more of a trend of people encouraging proactive protective measures.

KAREN: Let’s get back on that. We’re going to take a quick break, and I want to know more about the preventative.

ALLISON: That sounds good.

KAREN: We’ll be back in a second.

Welcome back to House Talk. This is Karen Malanga, Principal Broker at RE/MAX Key Properties and NestBend.com. Been out working all week in this snow, so if you’re thinking about listing or buying, give us a call at [phone].

I’m happy to welcome back Allison Glasier from Country Financial. She’s our go-to gal. She’s my insurance agent and handles my life insurance and all kinds of things, so if you need anything financial or insurance-based, I would recommend Allison Glasier.

When we left for the break, we were discussing – my daughter had sent in a question: are insurance companies covering items like roof heat strips to prevent this in the future? I think what Kristin was trying to say is, are some insurance companies going to be proactive about doing something preventative? Because even thought this doesn’t seem like our normal, it’s certainly not becoming abnormal to have these heavy snows. Allison, could you speak to that question?

ALLISON: Sure. I think that’s a really fair question and something that’s on a lot of people’s minds. Just to back up a little bit, when I started in this industry in 2007, I could insure a standard home for $300 or $400 a year.

KAREN: Yeah, I remember. [laughs]

ALLISON: Oh yeah. And now you’re looking at $700, $800, $900 for that same home. The fact is that insurance rates are going to continue to go up. Companies are going to take those rate changes at different times.

But the bottom line is that if you’re watching the news, you’re seeing these storms – you saw the fires last year in California, you’ve seen the devastation that’s happening based on some of these weather patterns – obviously that’s going to result in massive payouts, which is going to result in increased premiums.

KAREN: For everyone, nationwide.

ALLISON: For everyone. That’s how it works. Insurance is a distribution of that risk. As these weather extremes become more of a pattern, I think all companies are looking to say, how do we remain competitive but also remain in a position where we can pay our claims fairly and correctly?

KAREN: Sure.

ALLISON: Right. So there will be more segmentation happening. I think things like metal roofs or, like you said, some heated gutters –

KAREN: Is that what segmentation means? Pretend I’m five and I don’t know what you’re talking about. [laughs] What does segmentation mean?

ALLISON: Sorry for the jargon. Segmentation is where a company is going to try to really identify and distinguish the different risks so that they can charge the right amount of money for that specific type of risk.

KAREN: Okay, so if you add a metal roof or something, they may in the future charge you less, because obviously it’s not going to catch on fire.

ALLISON: Sure. Their probability of paying that claim is going to be less. So I think you are going to see companies come up with more of a niche, that they’re looking for a certain type of home or a certain type of homeowner.

KAREN: Sure. Kristin also – and I’ll repeat, Kristin Marshall, she’s a broker with me at RE/MAX – here’s her third question. “While having more than ice dam leak during one storm is considered one event, does having more than one leak in the same event affect the claim differently?”

ALLISON: She’s wanting to know if the same storm is causing multiple issues…?

KAREN: Yeah, is that multiple claims, or is that going to be one claim for them? Just to sidetrack a little bit, their baby’s room, the walls are now being removed, the master closet. They’ve got a lot of leaks coming through. Is that going to be two claims or one claim on their record? That I think is her question.

ALLISON: If it were me, I would be reporting that as multiple responses to one occurrence.

KAREN: Okay, multiple responses to one occurrence.

ALLISON: Right. The storm is the occurrence that’s causing this issue. So I would say a good adjuster is going to be able to communicate through that and understand that this is a secondary result of the same occurrence. But I think, again, it’s really going to come down to communication.

KAREN: And also the company. She has one last question here.

ALLISON: Sure.

KAREN: Number four. She said, “I heard Allstate was going to file a state of emergency due to the last storm. How does that affect current claims with the same and different companies?”

ALLISON: That’s also a good question. Thanks, Kristin. [laughs] All of us are bound by state regulatory boards which say we have to have a certain amount in reserves based on the number of policies.

If you look at JD Power’s ratings – that’s an independent third party that looks at how satisfied customers are based on certain companies’ claims paying. That’s an important piece to reference, because it will give you an idea of how hard people have had to fight to get their claim paid fairly.

KAREN: If it is a state of emergency, does that expedite things?

ALLISON: I would think so. I would think that they would bring in everybody they’ve got from the claims world to come and try to help manage those things quickly.

One of the things that I’m getting a lot of questions on lately is, “Do I get on my roof?” I think really, we have to say for safety reasons, we’re not advising people to get on their roofs. We’re really not.

KAREN: My son-in-law fell off his ladder and hit the ice. Fortunately he’s fine. He’s probably needing a little ibuprofen or something. But he was trying to get some of the snow away since they have these active leaks and trying to help, but he did fall off the ladder.

ALLISON: Yeah, exactly. And he’s young. We did a search for snow rakes – Amazon is backordered. [laughs]

KAREN: I have three.

ALLISON: Oh, you do? You may have people calling you to borrow them. [laughs]

But that is what I’m telling people: if you can get your hands on one, try to take off what you can reach with that to at least get it away from those gutters and take some of that weight off. But maintain your safety first and review your policy, and know that this is why you have insurance and make sure that it’s correct.

KAREN: Sure. Well, I don’t know what to do anymore. I was gone for a while and I came home, and I have maybe three-and-a-half feet of snow. And then of course, my friends came over and helped by raking off the roof, but now it’s filled with ice chunks. Oh my goodness, the weight on my deck, what is that going to be? Because some of that came off the roof.

ALLISON: Yeah. Again, the weight of snow will be covered.

KAREN: Okay, perfect, because the deck wasn’t in good shape to begin with. [laughs] I’m teasing.

ALLISON: [laughs] You’re so funny. Your insurance, the whole point is to get you back to where you were. That’s what it should do.

KAREN: All right. Allison, thank you so much. I know this was a busy day for you, but I felt that this was such a current topic, and who can speak to it better than you? Allison, can you tell our listeners how to reach you?

ALLISON: Thanks, Karen. It’s always a pleasure to be here with you. This is Allison Glasier. I’m with Country Financial here in Bend, and you can reach me and my awesome assistants at [phone]. Thank you.

KAREN: Thanks, Allison. Take good care out there. Drive carefully.

ALLISON: You too.

KAREN: We’ll be back after the break.

Hi, welcome back to House Talk. This is Karen Malanga, Principal Broker at RE/MAX Key Properties. The first two segments of our show today were great. That was Allison Glasier with Country Financial, discussing what to do with this snow so that you keep any issue that may come up on your home covered by insurance.

I think the best takeaway from that is to call your agent, and if you do have an issue, go ahead and find out what you can do to be proactive that won’t harm any potential claim.

My next guest was going to be someone from the city of Bend; I thought it’d be interesting to have them come in and explain the condition of our roads, but they’re not here. Maybe they can’t get here. [laughs] I don’t know. I’ve been out showing property, and I am telling you, it’s a mess.

Anyway, we’re not going to get the lowdown from the city today. Maybe next week. I thought I’d talk about something else that’s really current, and that was the very quick passing of Senate Bill 608, and that is the statewide rent control. That does affect all of us, whether you’re a tenant or whether you’re an investor that owns rental property.

I know that there’s a lot of questions about it. We do have a simple summary of what the new things are on Senate Bill 608, and you can find that on our website. It’s NestBend.com. You can also call us if you have any questions or concerns, because there’s going to be a lot of changes, and it does affect – especially if you’re a real estate investor, I think it’s really pertinent that you know all the ins and outs of this bill. You can reach me at [phone].

Anyway, Senate Bill 608 went into effect last Friday. The governor declared it as a state of emergency. It went into effect immediately. Some questions that are real estate-based – I’m going to go over some questions that were texted in to me and that are also really relative to the summary that you can find on our website.

One was, “If I have a transaction that closes after the law goes into effect, can the new owner evict the tenants?”

That depends. Generally you may only evict for a tenant cause or a qualifying reason for termination under the circumstances that the law provides. Once you become an owner of a qualifying rental property, you’re now instantly a landlord, and your conduct is going to be governed by this bill.

So that’s another reason that you really need to review Senate Bill 608 and know the ins and outs. The law does allow for specific circumstances, though. If you’re purchasing the property and you’re a new landlord, you can evict a tenant, landlord-based, for reasons including significant renovations, demolitions, safety, or if you as the investor are going to live in one of the units.

Say you bought a duplex and you’re going to live in one; you can therefore evict that tenant. And I’m not saying I’m for evicting tenants by any stretch of the imagination. I’m just looking at this from an investor standpoint and so that you can better understand the ins and outs.

Another question that I had from two clients who are out of town – they’re actually flying in and we’re going to meet about this – is, “How does this impact closing timelines for rental occupied properties where the new owner will occupy the residence?”

The closing date of the real property is not really going to be affected by this bill, but the possession of the property may be. That’s another thing, so if you want to go to our website and look at that, that might be important to you.

The law caps rent increases. What it did is it went statewide, and what that did was it took away any rights of cities or counties to maybe have a different cap. Our cap here in Deschutes County is going to be the same as it’s going to be in Harney County, as it’s going to be the same in Multnomah County.

That’s an interesting caveat, and I think that’s why some people were against the bill. It was one of the small details that ends up being a really important detail. But anyway, if you’re in Deschutes County you’re going to have the same rent cap that they’re going to have in Multnomah.

Then the month-to-month tenancies – everything is basically affected. One client texted in and said, “What about month-to-month tenancies?”

For the first 12 months of occupancy, a landlord can terminate the tenancy without cause with a 30-day notice. After the first 12 months of occupancy, a landlord may only evict a tenant for cause by using an existing tenant-based reason or by using one of the four landlord-based reasons. Again, another reason to review this bill. It’s got a lot of intricacies.

There’s some exceptions to month-to-month tenancies and fixed term tenancies. A fixed term tenancy might not automatically roll over at the end of the fixed term per landlord discretion if the tenant has violated the terms of the rental agreement three separate times during a 12 month period with written warnings for each violation given along with the violation.

I think the best thing that you can do as a landlord right now is learn this bill, be proactive, and be really following all the ins and outs and the intricacies of this to the letter, because if you don’t it’s going to impact you tremendously.

If you’d like more information, please, again, visit Karen Malanga at RE/MAX. Our website is NestBend.com. Again, this summary will be on our website and very easy to find. Thank you for listening, and I’ll be back next week.

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