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My ceiling was very damaged by leak in roof caused by leaky solar panel. They instructed me to get mitigation estimate and repair estimates. Sent to insurance company and they paid.

My husband refused to mitigate and just repaired ceiling damage. Have receipts for repair. Will the insurance company demand funds be returned and cancel my insurance after 40 years paying insurance through escrow with my lender? They did not cover the roof replacement of $30,000 out of my pocket.

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  • Are you saying you replaced the roof, but didn't address the source of the leak? Or that you were paid just to address the source, but fixed the roof covering that issue?
    – JTP - Apologise to Monica ♦
    Apr 15, 2017 at 23:14
  • I read this as he fixed the ceiling (below the roof) but not the leak in the roof. The roof is the thing outside, on the top of the house. The ceiling is the thing inside, on the top of the room. There is usually some amount of space between the ceiling and the roof. This space may be called an attic. Water leaks through the roof (shingles, etc.) and damages the ceiling (drywall or whatever), causing staining. So we can expect that the roof will continue to leak and damage the ceiling again. Also, it may be damaging the joists.
    – Brythan
    Apr 15, 2017 at 23:29
  • Was the $30K actually spent on the new roof?
    – JTP - Apologise to Monica ♦
    Apr 16, 2017 at 1:38

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There are two scenarios that I see.

  1. You have a mortgage on the property. Generally the insurance company sends the funds to the lender, who then releases the funds to you as you make the repairs. They do it this way because if you never make the repairs the value of the collateral is decreased, and the lender wants to protect their investment.

  2. There is no mortgage. You will get the funds directly, and the insurance company will not force you to make the repairs especially if the repairs are cosmetic in nature.

In either case if you don't fix the cause of the leak, and make repairs to the site around the leak, you will run into a problem in the future if the leak continues, or the rot and mold continues to spread.

If you file a future claim they are likely to ask for proof of the original repair. If you didn't make it, they are likely to deny the second claim. They will say the cause is the original incident and if you had made the repair, the second incident wouldn't have happened. They are likely to drop you at that point.

If you try to sell the house you will have to disclose the original leak, and the potential buyers will want you to make the repairs. Any mold or rot spotted by the home inspector will be a big issue for them. It is also likely to be an item that they will be advised to demand that you get a legitimate company to make the repair before the deal can move forward, and won't negotiate a lower price or a credit for $x so they can get the repair done. Some will just cancel the deal based on the inspection report.

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  • WE have been paid for the claim (except for a portion which will be paid after all receipts have been submitted)) and deposited funds into savings at bank who holds the mortgage. If mitigation receipt is not received will the insurance co want the funds returned and will they cxl?
    – Sylvia
    Apr 17, 2017 at 23:46
  • In my experience the insurance company sends the funds directly to the lender and lets them distribute the funds after the repairs. The insurance company in my experience has not tracked the repairs, but you risk them not covering the next repair if you can't prove it is a new unrelated issue.
    – mhoran_psprep
    Apr 18, 2017 at 1:24

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