Friday, November 02, 2012
Thursday, November 01, 2012
Our continuing education course, Foreclosure and the Economy, scheduled for this evening has been cancelled and will be rescheduled as a result of Hurricane Sandy. Stay tuned for the announcement of our new date.
New York Governor Cuomo announced yesterday that homeowners will not have to pay hurricane deductibles on their claims.
A hurricane deductible is the amount of money a homeowner is responsible to pay for out-of-pocket before their insurance policy will kick in for hurricane related damage. Moreover, while traditional deductibles are generally flat dollar amounts for fire and theft (i.e. $5,000), with a hurricane deductible its often a percentage of the storm damage, which can be quite high (1% to 15%).
To read the Governor's press release, click here.
A hurricane deductible is the amount of money a homeowner is responsible to pay for out-of-pocket before their insurance policy will kick in for hurricane related damage. Moreover, while traditional deductibles are generally flat dollar amounts for fire and theft (i.e. $5,000), with a hurricane deductible its often a percentage of the storm damage, which can be quite high (1% to 15%).
To read the Governor's press release, click here.
Some great information on homeowners insurance issues from our friends at Douglas Elliman:
The following includes information regarding damage control immediately
following Hurricane Sandy. Erik Braunitzer is a writer for Douglas
Elliman, brokers for NYC, Long
Island and Westchester Real Estate.
Waking up after Sandy, many
people in the Northeast are left with a devastating truth: their homes are gone
or flooded beyond repair. Some of these homeowners may not be ready for the
awful truth that comes next. They may not get their homes back. The truth is
homeowner's insurance usually excludes flooding and hurricane damage. If you
don't know the ins and outs of your policy before a destructive storm, it will
be too late to change your policy later to cover these gaps. Most often, these
following areas cause the most issues after devastating destruction.
1. Replacement Value
Replacement value or cost is
listed in your homeowners policy and means the value of the loss at the amount
it costs to replace an item. For example, if you have property in your home,
such as a home computer, you may think that you will get a brand new computer
with same features at the original price. However, unless your policy states
this exactly in your insurance policy, losses are valued at what they were
worth in the condition before the destruction--in this case, a five-year-old
computer may only have a value of $200. Replacement-cost-value clauses should
always be included in your policy.
2. Flood Insurance
Homeowners insurance policies
usually exclude flood coverage, as well as hurricane cover and earthquake
coverage. Whatever the cause, floods happen, particularly because of exploding
pipes and the amount of rainfall in a hurricane. Floods are actually the most
common reason for damage to the home. Some insurance companies include some
types of flood coverage. If you live an area susceptible to flooding or if you
want to be sure you are covered, adding flood coverage can save you from a lot
of financial stress.
3. Negotiating Valuation of Loss
One of the first things that
people do after a damaging hurricane is call the insurance company to file a
claim. After you file a claim, an appraiser comes to the property and assesses
the damage. These appraisers do not work for you. They work for the insurance
company. They are looking for the minimum that the insurance company will have
to pay in order to meet its obligations. However, you do not have to take that
valuation as final. If you can prove the loss is significantly higher,
negotiate a settlement with the company. To prove your claim however, you need
to take pictures of damage and loss of valuables, as well as keep receipts for
repair costs.
4. Hotel Stay or Rental Coverage
If you have this in your policy,
it will be listed as "loss-of-use" coverage. This means that the
insurance company pays to place you in a hotel while work is being completed on
your home, if it is uninhabitable. Not all policies include these types of
provisions and others have limitations, such as a maximum per day amount or a
time limit for how long expenses are covered. To avoid the out-of-pocket living
expenses after a hurricane, ensure that you have loss-of-use coverage.
Wednesday, October 31, 2012
In answering this question, the first issue is if the damage is material to the contract or is instead merely ancillary. To illustrate, lost electric or a few shingle down is likely immaterial, whereas flooding with structural damage is typically material.
If material, the contract is unenforceable at the option of the purchaser (the seller has no option). In this scenario, if the purchaser does not want to pursue the contract and therefore does not want to close on the real estate transaction, the purchaser can have their deposit (Earnest Money) returned.
If immaterial, the contract is enforceable, but the purchaser has a right to an abatement (reduction) of the purchase price reflecting the damage.
Nonetheless, if there is a prepossession agreement and the purchaser is in possession, regardless if the damage is material, the contract is enforceable as is.
These are the default rules embodied in General Obligation Law 5-1311, but a contract of sale can be drafted to amend these rules however the parties agree. Therefore, it is imperative that you review your contract of sale before you act.
If material, the contract is unenforceable at the option of the purchaser (the seller has no option). In this scenario, if the purchaser does not want to pursue the contract and therefore does not want to close on the real estate transaction, the purchaser can have their deposit (Earnest Money) returned.
If immaterial, the contract is enforceable, but the purchaser has a right to an abatement (reduction) of the purchase price reflecting the damage.
Nonetheless, if there is a prepossession agreement and the purchaser is in possession, regardless if the damage is material, the contract is enforceable as is.
These are the default rules embodied in General Obligation Law 5-1311, but a contract of sale can be drafted to amend these rules however the parties agree. Therefore, it is imperative that you review your contract of sale before you act.
Tuesday, October 30, 2012
First, homeowners policies are all unique and must be read in their entirety. If you have any questions about your policy, you should contact an attorney rather than taking the word of your insurance company because they are not in the business of advocating for you and instead seek to minimize their payments / exposure.
Its important that you don't assume that you do or don't have coverage for a specific loss. There are many gray areas of coverage.
An important item to review in your insurance policy is if it pays Replacement Value or Cash Value for your damaged property.
Replacement Value refers to the cost to replace the property on the same premises with property of comparable material & quality.
Cash Value refers to the cost to replace with new property of like kind & quality, less depreciation.
To be clear, Replacement Value is much better for the insured than Cash Value as there is no depreciation taken into account when evaluating the homeowner's claim.
Next, you should check your deductible, take pictures of your losses, make a list of everything damaged / lost and promptly contact your insurance carrier to provide them with adequate notice (there are generally notice requirements to obtain your insurance coverage, including the way you provide notice and to whom).
Its important that you don't assume that you do or don't have coverage for a specific loss. There are many gray areas of coverage.
An important item to review in your insurance policy is if it pays Replacement Value or Cash Value for your damaged property.
Replacement Value refers to the cost to replace the property on the same premises with property of comparable material & quality.
Cash Value refers to the cost to replace with new property of like kind & quality, less depreciation.
To be clear, Replacement Value is much better for the insured than Cash Value as there is no depreciation taken into account when evaluating the homeowner's claim.
Next, you should check your deductible, take pictures of your losses, make a list of everything damaged / lost and promptly contact your insurance carrier to provide them with adequate notice (there are generally notice requirements to obtain your insurance coverage, including the way you provide notice and to whom).
While there are statewide laws for home improvement contracts & County / City laws, do not forget to also check your local municipality for their laws as well. Pursuant to General Business Law 775, local laws are permissible regulating home improvement contractors provided their are not inconsistent with State laws. So, a contractor may need to also be licensed on the local level. Additionally, there may be required contract provisions for your job.
While we have substantial damage from the storm throughout the region & need repairs, its important to ensure that these consumer protection statutes are followed by contractors along the way.
While we have substantial damage from the storm throughout the region & need repairs, its important to ensure that these consumer protection statutes are followed by contractors along the way.
All home improvement contractors in Westchester County need to be licensed. To read the Laws Governing the Licensing of Home Improvement Contracts in Westchester County, click here.
To look up if a home improvement contractor is licensed in Westchester County, click here.
Remember, if your contractor is unlicensed, they cannot enforce your home improvement contract against you & they are subject to arrest & prosecution.
To look up if a home improvement contractor is licensed in Westchester County, click here.
Remember, if your contractor is unlicensed, they cannot enforce your home improvement contract against you & they are subject to arrest & prosecution.
All home improvement contractors in New York City need to be licensed to perform the following services, among others:
construction, repair, remodeling, or addition to any land or building used as a residence. This includes, but is not limited to, the construction, replacement, or improvement of basements, driveways, fences, garages, landscaping, patios, porches, sidewalks, swimming pools, terraces, and other improvements to structures or upon land that is next to a home or apartment building.
In New York City, there is also a license requirement called a Home Improvement Salesperson License for those who "solicit, negotiate, or offer to negotiate a home improvement contract with a property owner".
Click here to verify licensing in New York City.
Remember, if your contractor is unlicensed, they cannot enforce your home improvement contract against you & they are subject to arrest & prosecution.
construction, repair, remodeling, or addition to any land or building used as a residence. This includes, but is not limited to, the construction, replacement, or improvement of basements, driveways, fences, garages, landscaping, patios, porches, sidewalks, swimming pools, terraces, and other improvements to structures or upon land that is next to a home or apartment building.
In New York City, there is also a license requirement called a Home Improvement Salesperson License for those who "solicit, negotiate, or offer to negotiate a home improvement contract with a property owner".
Click here to verify licensing in New York City.
Remember, if your contractor is unlicensed, they cannot enforce your home improvement contract against you & they are subject to arrest & prosecution.
