"Twas the night before Christmas
when all through the house
Not a creature was stirring
not even a mouse;
The water supply lines were disconnected
without any care,
In hopes that the insurance company
would not investigate anywhere."
Poem by Clement C. Moore
(with additions by the author)
As those of us in cold weather climates prepare to celebrate the holidays with friends and family, the season of staged water loss claims is almost upon us.
The holidays and the months of January and February often see a spike in insurance claims being filed. Everyone has new personal property without receipts and credit card bills coming due. In this season of giving, no single fraudulent claim has flown under the radar more than staged water losses.
For fraudsters, water losses are the perfect vehicle for catching up on past due bills and for getting that remodel they have been trying unsuccessfully to save for, all without getting the police involved.
Not only do freezing pipes occur naturally this time of year, but homes are frequently vacant for days or even weeks at a time, with Grandma and Grandpa unwittingly providing an alibi.
Firefighters and public sector investigators don’t examine the house or document the scene after a water loss. Local building departments rarely condemn a building after a water loss as unsafe, which would protect vital evidence of fraud.
No, instead, water remediation companies are sent out to secure the location and start the process of making their insureds happy. And herein lies the problem.
Staged Water Losses (aka Arson for a New Age)
The single biggest obstacle in litigating water loss claims is the spoliation of evidence by remediation companies. This makes sense as the first instinct of insurance providers is to mitigate the loss and prevent further damage. However, remediation companies don’t begin washing soot off the walls or throwing away fire debris before a fire investigator completes his examination.
So, why allow a water remediator to repair damaged piping, dry out the area and dispose of any useful evidence for your investigation? Instead, the first call after a water loss claim is submitted should be to a forensic engineer.
“But Nick,” you say, “I don’t know any forensic engineers. Or even where to hire one!”
You do dear reader, you do! Most if not all vendors the insurance industry relies upon for experts and investigators have forensic engineers on staff. Many are physical, structural, electrical or other specialty engineers, posessing additional training or certification in forensic analysis.
Like a fire investigator, a forensic engineer is going to determine the origin and cause of the water loss. Most importantly, all of this will be performed using the scientific method, the gold standard for determining whether an expert’s opinion will be admissible in court.
So, this year when the usual post-holiday influx of insurance claims begins, give yourself the gift of expert support. Remember to call your forensic engineer before your water remediator. Your SIU department will thank you later.
Nicholas W. Siewert is a member of Plunkett Cooney's Product Liability, Torts & Litigation and Construction Law practice groups. His experience includes handling matters involving premises liability, product liability and ...
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