by Guest » Fri Sep 07, 2012 02:50 pm
I have a 2 story duplex in NC (700sf per level) where the second story was completely destroyed by a tree to the point where roof, walls and part of floor and elect will require replacement.
The claim has been put at 45k acv and 65k replacement, such that they have sent 45k and they are withholding 20k. There is no mortgage. It looks like the town will let me build a separate cottage on the same lot and just put a roof on what is left of that structure. I am looking at building 700-900 sf structure and spend more than 65k for which I will have receipts (but it will be on a building located next to the one which was hit). Will this qualify for replacement cost reimbursement such that I would be able to collect the 20k?
The claim has been put at 45k acv and 65k replacement, such that they have sent 45k and they are withholding 20k. There is no mortgage. It looks like the town will let me build a separate cottage on the same lot and just put a roof on what is left of that structure. I am looking at building 700-900 sf structure and spend more than 65k for which I will have receipts (but it will be on a building located next to the one which was hit). Will this qualify for replacement cost reimbursement such that I would be able to collect the 20k?
Posted: Mon Sep 10, 2012 12:43 am Post Subject:
This is a duplicate of the same post in another forum. The answer remains the same: replacement cost covers essentially the cost to restore what you once had. You had a single dwelling. It's wonderful that your local building code will allow you to build a second dwelling on your lot.
Why is it your insurance company that should be asked to foot the bill for that?
If you rebuild what you once had, fine, the insurance will cover that -- up to the limit of your policy. But turning one dwelling into two separate dwellings -- if done at the expense of an insurance company is an unjust enrichment to you.
Posted: Tue Sep 11, 2012 03:49 pm Post Subject: duplex in NC
Thanks. The other issue with the property which I did not mention is that the foundation is faulty such that the engineer looking at it have said that it could not withstand the extra load of rebuilding the upstairs portion (since the old roof was framed with 2x4 and the new roof would require heavier components. There is essentially no footing (just 8" wide brick foundation laid right on clay soil). So spending 25k removing the upstairs and putting a roof back over the first story, and building the 700 sf next to it may be the only safe thing to do other than taking down and rebuilding the entire structure (the estimate for rebuilding the foundation was 40k and is not covered by insurance as it is a code upgrade). I also have the option of building the 700 sf as an attached structure but BESIDES instead of on top (so it would still be a "duplex"), although that is more expensive as it still involves fixing part of the old footing while building separate would be cheaper. Would keeping it a duplex but building along side entitle me to the replacement cost money do you think?
Either way, I would spend 70k on the new building PLUS 25k on the roof over the first floor, so either way I end up spending 30k of my own funds, which I am fine with. I'm not trying to get something for nothing, just trying to work with what I have got.
Posted: Tue Sep 11, 2012 10:00 pm Post Subject:
The other issue with the property which I did not mention is that the foundation is faulty such that the engineer looking at it have said that it could not withstand the extra load of rebuilding the upstairs portion (since the old roof was framed with 2x4 and the new roof would require heavier components. There is essentially no footing (just 8" wide brick foundation laid right on clay soil)
Roof trusses are commonly engineered out of 2x4 material, possibly with 2x6s as the base chord if the unsupported span is too great, so I can't express any opinion as to your reconstruction of the roof except to say I don't think there would be any significantly greater load than you previously experienced, unless you were changing the roofing material to clay or concrete tile.
(the estimate for rebuilding the foundation was 40k and is not covered by insurance as it is a code upgrade)
Even though this may be true, I doubt that you could convince the insurance company to pay for a second dwelling construction to replace your missing second floor. It's still an apples-to-oranges comparison.
Your most viable solution might be to tear down the remaining structure -- as unrepairable to its previous condition which is the "indemnification" promised by your policy (to restore you to whole) -- and rebuild your 2-story structure. Ignoring the building code upgrade issue, pouring a new concrete foundation on bare soil is far less costly than trying to underpin and stabilize an existing structure. And other foundation systems (such as insulating concrete forms or "ICF") may actually be more suitable for your location and even less costly.
I would suggest that you sketch some plans for a rebuild (to essentially the same nature of the original structure -- they don't have to be detailed construction plans at this point (but figure $3000-$5000 or so for a full set of plans) and get some estimates from licensed contractors in your area for the cost to demolish and rebuild according to your design. You may easily be able to do that within your policy limits and the insurance company should respect that and pay for it. The professional engineer's report could be rewritten to discuss this possibility.
Posted: Thu Sep 13, 2012 07:05 pm Post Subject:
Thanks again for your gracious reply. The old roof was framed by sandwiching 2x2 inch pine between 2 pieces of half inch plywood. Some of the walls are also 2x2, believe it or not. Indemity doesn't seem to cover me because they are saying the foundation issues were pre-existing or "code upgrade" issues which are not covered. Builders have told me I could rebuild within the policy limits (135k) but the policy doesn't seem to be covering that. They sent their engineer out and determined the foundation damage was preexisting (which it mostly was ) and are saying they can only pay the 65k. Is their something I am missing or a different tact I should be taking with them? Thanks again.
Posted: Thu Sep 13, 2012 10:21 pm Post Subject:
Well, now that you are admitting that you knew there was preexisting foundation damage, be glad that the insurance company is providing any coverage at all. Take the money and do with it as you please. You are unlikely to obtain any more than what you have already received.
You need to demolish what's there and build something that is structurally sound, or sell it to someone as is and add that to your insurance funds and move on.
Posted: Fri Sep 14, 2012 05:15 am Post Subject:
Not pre-existing "damage" (there was no damage), just sub code foundation (brick laid directly on clay with no footing when it was built in the 1940s prior to building codes). I have an engineers report to document. I don't expect them to pay to repair this. I was just looking for a solution where I can spend 70k instead of 135K, since the bottom story is salvageable. It sounds like there is no good solution and I will take a loss on the other half the structure. Can you forward a link to the other similar post you referred to in your first response. Thanks.
Posted: Fri Sep 14, 2012 08:05 am Post Subject:
For the life of me, I cannot find the other post or my response. Weird.
Brick on clay with no foundation? I wouldn't even want to be within spitting distance.
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