CA total loss, in the middle (at the end rather) of an extensive remodel Justin Lieb asked 3 days ago
CA total loss, in the middle (at the end rather) of an extensive remodel

My family was at the end of a pretty extensive remodel of our home in Altadena when the Eaton Canyon fire destroyed it. We were financing the remodel with a HELOC loan and adding about 700 square feet. All structural work was complete and we had stucco, shingles, paint, cabinets and flooring to go. Do we have any recourse in recouping any of that loss?

The remodel was not reflected in our insurance policy but all work was permitted. Further, our policy is based off of $356/ sq ft which is very unrealistic in this situation and we’re very worried.

It seems the HELOC loan is not insured either (even though providing them with our homeowner’s insurance is part of obtaining that loan)?

1 Answers
Answer for CA total loss, in the middle (at the end rather) of an extensive remodel United Policyholders Staff answered 3 days ago
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Hi Justin,

Each policy has different requirements about notifying the carrier when remodeling or major changes have been made to the property. If you hadn’t modified the policy prior to the fire to account for the additional square footage, then you are going to be limited to the policy limits available on the date of the fire/loss. One thing to notify your carrier about would be any building materials that were on site, awaiting installation, as these would be covered under your Coverage A Dwelling limit, subject to your Coverage A policy limit. However, it sounds like your property is going to cost more to rebuild than your policy will provide.

Unfortunately, your HELOC loan is not considered part of your insurance policy; this is a separate loan that you are obligated to pay. We would recommend talking with your financial advisor regarding options for this loan and your rebuild situation, since the situation can be complex.

UP provides the following resources to guide you through this process:

https://uphelp.org/claim-guidance-publications/underinsurance-101/

https://uphelp.org/claim-guidance-publications/tax-information-for-disaster-survivors/

Kindly, UP Staff