If you have incurred damage to your residential or commercial property, be it water damage, mold damage, storm or hurricane damage, fire damage, structural damage, cast iron pipe failure or damage due to environmental disaster, you will want to file an insurance claim with your insurance company. Before meeting with the insurance company’s damage assessment adjuster and even before hiring a contractor to begin restoration, you will need to understand the term Pre-Loss Condition and what it means for your property and your claim.

What is Pre-Loss Condition?

When you invest in property insurance for your home or office building you will most likely come across the term pre-loss condition in your contract. Simply put, the pre-loss condition refers to the condition your property was in before the damage occurred. Moreover, if the damage your property sustained is covered by your insurance policy, the insurance company will pay to restore your property to this pre-loss condition.

So, for example, if your home sustained water damage and this is covered by your insurance policy, the insurance company will pay to repair and restore your home to the condition it was in before the water damage occurred. In some ways, the idea of pre-loss condition is meant to secure the interests of the insurance company by ensuring that the property owner does not take advantage of the situation by opting for expensive home improvements. However, in reality the carrier ignores the Pre-Loss condition requirement and will only authorize payments for repair and patch work. As a second example your property suffers a covered loss that damages a single wall that now requires that wall to be repainted. The insurance company will in fact authorize payment for that specific damaged wall. What about the other three walls in that same room? Will the new fresh paint match the old paint that was applied many years back? No of course not! All the walls in the room will need to be painted to make the room look like it did before the loss occurred with uniformly colored paint on all the walls of the damaged room.

What Does the Insurance Company Pay For?

There are three main ways in which your insurance company may enforce the clause of pre-loss condition after you sustain property damage.

1. Similar Quality

The insurance company will only restore your property with materials that are of the same or similar quality as the ones that you previously had. If, for example, your flooring was $1.50 per square foot, the insurance company will enforce the pre-loss condition clause by only paying for flooring of the same quality. However the rising costs of construction and inflation the floor that cost $1.50 sqr/ft many years back might be double the cost in today market. Moreover, finding a matching flooring to repair the damaged area may just not be a feasible. In that case you will need to replace the continuous flooring to ensure your floor looks like it did before the loss occurred.

2. Comparable Materials

Your insurance company will restore your property to pre-loss condition by covering the cost of using a comparable material to the one that was damaged. Your insurance company will not pay for material upgrades to your property. Using the same floor example you cannot decide to upgrade your linoleum flooring at $1.50 per square foot to marble at $15.00 per sq ft.

3. Building Code Upgrades

All residential and commercial properties in Florida are subject to the Florida Building Code. There are no exceptions. Many inexperienced homeowners and commercial property owners are surprised when they discover all the new building codes and standards that must be followed. The Florida Building Code has changed much time over the years in significant ways. By example your kitchen which was remodeled just 10 years ago suffered a covered loss that now requires a total renovation of the kitchen. Many residential and commercial insureds are shocked to find out that the same renovation you performed years back was likely under a different code and different requirements. The same kitchen renovation you want to do now may require certain upgrades to bring the project up to current Florida Building Code standards. The insurance company is required to pay for the additional costs associated with the necessary code upgrades and bring your property up to the current relevant building codes.

Can I Hire My Own Restoration Contractor?

As an insured property owner, you are free to hire whichever restoration contractor you choose. The insurance company is only bound to determine how much they will pay for restoration. However, since the insurance company will always try to uphold its financial interests, they will most likely offer a list of contractors that they would prefer you to hire. Unfortunately, these contractors will have the best interest of the insurance company in mind and will probably work towards the insurance company’s financial gain.

Your insurance company’s preferred vendor could harm you by performing substandard repairs, using low-quality materials, or by failing to follow industry protocols. If your insurance company is requiring you to use their contractor you may want to hire an attorney to review your insurance claim and advocate on your behalf against the insurance company.

Final Words

If you have sustained damage to your property via a tropical storm, hurricane, or other severe weather events, or if you have incurred roof damage, pipe burst, cast iron failure, fire damage, flooding, water damage, mold damage, theft, or vandalism to your property, Consumer Law Office (CLO) can help you receive the compensation you deserve under your insurance policy.

The experienced and dedicated Property Damage Attorneys of the Consumer Law Offices P.A. have helped thousands of homeowners, contractors, and businesses resolve their coverage disputes through strategic negotiation, mediation, litigation & conclusion at trial where necessary.