Should I look for a lawyer?
September 7, 2011 7:51 PM Subscribe
Fellow MeFi's, I am debating whether I should dispute the outcome of a marine insurance claim. Any input from someone that has dealt with insurance companies would be greatly appreciated. However, as I realise that my opinion on the matter is obviously biased, any independent assesment of the situation would also be very useful.
So I have an old (1970) wooden motor yacht that has undergone extensive hull renovation a few years ago, done by the previous owner. It has been sitting in a covered slip for the last three years rather happily until last month, when I got a call from the marina office after they discovered that it started taking on water at fairly alarming rate. The insurance company has been notified at the same time, and they sent their local surveyor to haul the boat out and evaluate the situation. His conclusion was that the reason for the flooding is general deterioration of the planking, fastners and frames of the hull (basically, the hull is falling apart). Now then, in addition to the general liability policy, the insurance company has also provided me a hull coverage based on the result of the survey done in 2006 (which noted the repairs and renovations done to the hull). The hull policy covers, among other things, total constructive loss due to latent defects ("latent defects" means "a hidden defect in material, design or construction existing at the time of the original build of the vessel or any additional or replacement parts, components or systems of the vessel which are not dicoverable by ordinary observation by an experienced marine surveyor"). The boat is pretty much a total loss at this point, however the insurer is refusing to pay based on a particular exclusion condition, which Reads as follows:
WEAR AND TEAR
Any physical damages or loss caused by wear and tear, including, but not limited to, deterioration, corrosion, oxidation, or electrolysis, delamination, and osmosis. This exclusion applies only to the coverage of the worn part.
Which brings me (finally) to the point of my question: since this exclusion applies only to "a worn part", and the surveyor has not indicated that the reason for the boat taking on water was due to any specific part but rather general deterioration of the hull, can they really deny a total loss claim based on this exclusion? Especially since they advanced me the hull insurance without me asking for it. Is this something I should consult a lawer for or am I overreading things?
I don't have any experience dealing with insurance companies (other than paying them), and certainly would like to persue this matter further, but I don't want to make an ass of myself.
So I have an old (1970) wooden motor yacht that has undergone extensive hull renovation a few years ago, done by the previous owner. It has been sitting in a covered slip for the last three years rather happily until last month, when I got a call from the marina office after they discovered that it started taking on water at fairly alarming rate. The insurance company has been notified at the same time, and they sent their local surveyor to haul the boat out and evaluate the situation. His conclusion was that the reason for the flooding is general deterioration of the planking, fastners and frames of the hull (basically, the hull is falling apart). Now then, in addition to the general liability policy, the insurance company has also provided me a hull coverage based on the result of the survey done in 2006 (which noted the repairs and renovations done to the hull). The hull policy covers, among other things, total constructive loss due to latent defects ("latent defects" means "a hidden defect in material, design or construction existing at the time of the original build of the vessel or any additional or replacement parts, components or systems of the vessel which are not dicoverable by ordinary observation by an experienced marine surveyor"). The boat is pretty much a total loss at this point, however the insurer is refusing to pay based on a particular exclusion condition, which Reads as follows:
WEAR AND TEAR
Any physical damages or loss caused by wear and tear, including, but not limited to, deterioration, corrosion, oxidation, or electrolysis, delamination, and osmosis. This exclusion applies only to the coverage of the worn part.
Which brings me (finally) to the point of my question: since this exclusion applies only to "a worn part", and the surveyor has not indicated that the reason for the boat taking on water was due to any specific part but rather general deterioration of the hull, can they really deny a total loss claim based on this exclusion? Especially since they advanced me the hull insurance without me asking for it. Is this something I should consult a lawer for or am I overreading things?
I don't have any experience dealing with insurance companies (other than paying them), and certainly would like to persue this matter further, but I don't want to make an ass of myself.
I'm not an attorney, I'm not an insurance adjuster, but I suspect that, because your boat is leaking due to old age (or, "wear and tear") means that it is not going to be covered by your insurance. That said, would you feel right accepting payment for this? You admit it is due to the fact that the boat is "falling apart". this isn't an insurance claim.
posted by tomswift at 7:57 PM on September 7, 2011
posted by tomswift at 7:57 PM on September 7, 2011
Response by poster: I see your point, tomswift. The thing is, I've had this boat for three years, lived aboard until this spring. I have not had any problems with leaks or anything of this sort. As a matter of fact, I came to check on it 3-4weeks before the incident, and everything was fine. The "falling apart" statement comes from the surveyor, not myself. Granted, of course, that the guy is most likely more experienced than I.
posted by c13 at 8:21 PM on September 7, 2011
posted by c13 at 8:21 PM on September 7, 2011
Before I could decide to pursue it, I would have an independent expert inspect the boat to determine what went wrong. I think the insurance company inspector has an obvious bias away from impartiality. If the independent says it is from something other than age or wear and tear, then I would speak to an attorney and pursue it. If he agrees with the insurance adjuster, then I would negotiate with the insurance company for a partial payment to cover disposal costs etc.
posted by JohnnyGunn at 8:26 PM on September 7, 2011 [3 favorites]
posted by JohnnyGunn at 8:26 PM on September 7, 2011 [3 favorites]
Just because the hull looked fine 3-4 weeks ago doesn't mean it was fine. Often, rot in timber won't even show the slightest sign until it's way too late to repair it. In this case, you seem to be expecting the insurance company to replace your yacht because it has worn out - general deterioration of the planking, fasteners and frames effectively means the hull has reached the end of its useful life.
Unless the hull was completely replaced during the renovation work a few years ago, this is where the yacht was destined to end up - even if all the planking had been replaced (unlikely), the frames etc would have failed. The hull was likely close to beyond repair when the renovations were done and the renovations simply extended its life for a few years.
This doesn't sound like a valid insurance claim to me.
posted by dg at 8:52 PM on September 7, 2011
Unless the hull was completely replaced during the renovation work a few years ago, this is where the yacht was destined to end up - even if all the planking had been replaced (unlikely), the frames etc would have failed. The hull was likely close to beyond repair when the renovations were done and the renovations simply extended its life for a few years.
This doesn't sound like a valid insurance claim to me.
posted by dg at 8:52 PM on September 7, 2011
Grew up on sailboats. My dad dealt with marine insurance issues when I was a kid. Here is my take ---
This boat has not been out of the water in three years? Yeah. That is bad if true.
IF your boat has been out of the water and maintenanced during that time, collect your records and contact an attorney. Full stop.
Wooden boats, heck ALL boats, need yearly maintenance. Barnacles, wear and tear, freakin' water (which I know as a landlord is the ultimate enemy of any structure...) You might have been too confident here and this could be the cause of your hull failure.
My Dad's first boat was a wooden sailboat (named after me!), but after that we always owned fiberglass. Every year we discussed wooden boats at the marina when getting our own serviced - they were so pretty - my brother and I wanted another one!
He said they needed a lot of upkeep, and that every year you needed to take them out of the water, service them, re-seal, and then once back in a body of water you had to wait for the hull to "swell up" to prevent leakage.
If your boat never got serviced in three years, even with extensive marine sealing of the hull (and I know what this entail, FWIW) you put your boat at risk.
I'm so sorry.
If you did have your boat wintered and serviced, get those records and retain an attorney, which will be worth every penny!
Good luck.
posted by jbenben at 9:35 PM on September 7, 2011 [1 favorite]
This boat has not been out of the water in three years? Yeah. That is bad if true.
IF your boat has been out of the water and maintenanced during that time, collect your records and contact an attorney. Full stop.
Wooden boats, heck ALL boats, need yearly maintenance. Barnacles, wear and tear, freakin' water (which I know as a landlord is the ultimate enemy of any structure...) You might have been too confident here and this could be the cause of your hull failure.
My Dad's first boat was a wooden sailboat (named after me!), but after that we always owned fiberglass. Every year we discussed wooden boats at the marina when getting our own serviced - they were so pretty - my brother and I wanted another one!
He said they needed a lot of upkeep, and that every year you needed to take them out of the water, service them, re-seal, and then once back in a body of water you had to wait for the hull to "swell up" to prevent leakage.
If your boat never got serviced in three years, even with extensive marine sealing of the hull (and I know what this entail, FWIW) you put your boat at risk.
I'm so sorry.
If you did have your boat wintered and serviced, get those records and retain an attorney, which will be worth every penny!
Good luck.
posted by jbenben at 9:35 PM on September 7, 2011 [1 favorite]
IANYL, TINLA.
Talk to a lawyer who specializes in insurance law. In my jurisdiction there are a lot of nuances and terms of art which make interpreting coverage hard for a lay person. A lot of the time this includes, unfortunately, adjusters.
If your interpretation of your coverage is correct, a lawyer can help you put that to effect. If you're wrong, a lawyer can explain why. If the answer is somewhere in the middle, a lawyer can help you and your insurance company work out a compromise.
posted by AV at 3:50 AM on September 9, 2011
Talk to a lawyer who specializes in insurance law. In my jurisdiction there are a lot of nuances and terms of art which make interpreting coverage hard for a lay person. A lot of the time this includes, unfortunately, adjusters.
If your interpretation of your coverage is correct, a lawyer can help you put that to effect. If you're wrong, a lawyer can explain why. If the answer is somewhere in the middle, a lawyer can help you and your insurance company work out a compromise.
posted by AV at 3:50 AM on September 9, 2011
This thread is closed to new comments.
posted by c13 at 7:53 PM on September 7, 2011