A common scenario in my elder law practice is this: a parent cannot safely live alone and moves into a child’s home. One spouse has died and then the second develops with health problems that need “24 hour care.” It often goes like this
After Dad retired he and Mom continued living in the old home. After many happy years in retirement Dad passed away a few years ago. Mom started needing more help and Jill, the oldest daughter became her “executive assistant.” She’d make the 20 mile drive to visit, take Mom shopping or to her doctor’s appointments. From time to time they talked about Mom moving to a senior apartment closer to Jill’s house but Mom wanted to stay in the house where she lived for almost 60 years. Then Mom fell and broke her hip. After rehab she still could not return to her some so they had her move into a spare bedroom.
Recovery went slowly but eventually she returned home. And then she had her second fall. They went through the same process. This time recovery was even slower. Summer passed, then fall, then winter. They planned Mom would return home in the spring after being away almost a full year.
But then the fire happened. A neighbor saw the smoke and the fire department got it under control pretty quickly. The kitchen is part gone, but the home is fixable. The best guess was that a squirrel got in and chewed insulation off some wires, the wires shorted, overheated and started the fire
They file a claim with the insurance company who summoned the fire report which stated “No injuries. Nobody was living in the home at the time.”
Will the company honor the claim? Likely not.
A recent decision of the Michigan Supreme Court reminds us that we only have insurance according to the strict words of the policy. The case is Yu v. Farm Bureau Insurance Co of Michigan. In that case Mr. Yu was living in Portage and then got a job in Lansing. He and his wife got an apartment near work and visited their home on weekends. One day in winter a neighbor called them reporting big icicles on the side of their house. It turned out they had a broken water pipe in the bathroom and some pretty extensive damage.
The insurance company denied the claim because the home was not “occupied” under the terms of the policy and in fact the Yus’ “vacated” the home. It was not their primary residence. The court agreed and opined they could have gotten insurance as a seasonal or second home.
The moral is this: All homeowner’s policies define the term “occupied.” In fact many policies specify that the home is not “occupied” as the primary residence if the owner is absent for more than six months at a time.
So, if you are going to be absent from your home for an extended period of time, check the homeowner’s policy. You may find the home is uninsured. An insurance company may legally put many restrictions on coverage. You should review your policy and speak with a company representative to be sure you are reading it the same way they do.
