Tornado rebuilding produces surprises

Jim Stanley learned a valuable insurance lesson from his recent encounter with a tornado.

Even when you think you have "the best insurance" policy - one designed for total replacement of your home - it doesn't necessarily mean total replacement.

Two weeks after an EF2 tornado caused $1.5 million to $2 million in damage in the Lakeshore community, Stanley and other residents there are putting their homes and lives back together.

No stranger to disaster after he lost a business to fire a decade ago, Stanley found out the hard way that his homeowners policy doesn't cover code upgrades.

That means his insurer, Farm Bureau Insurance, will pay only the cost of 2-inch by 6-inch rafters to replace the roof of his 1970 house. But now the building code requires 2-inch by 8-inch boards.

"The insurance adjuster says they will pay the cost of 2-by-6's, but I have to pay the difference (for the larger boards)," Stanley said. "If it was a new home, it wouldn't be a problem because all new homes are already up to code. ... Replacement on mine is replacement as it was in 1970."

Stanley said he won't know for a while just what all the code changes, ranging from the rafters to a replacement "self-closing gate" on a small pool fence, will cost him.

Jim Zimmerle, the Farm Bureau insurance adjuster working with the Stanleys, said insurance companies are governed by state insurance commissions, and not covering code improvements is standard throughout the industry.

"We can only pay for what you had at the time (of the tornado or other damaging event)," Zimmerle said, adding that insurance adjusters don't decide how homes or businesses are to be repaired.

"Building inspectors are going to come out and dictate to the homeowners or contractors what they have to do," he said.

Another gap often left to homeowners after a claim is the cost difference between particle board flooring and plywood. Particle board was common in homes built or repaired in the 1960s through 1980s, but now does not meet code, Zimmerle said.

Bill Tittle, Hamilton County's chief of emergency management, said the damage levels in the county didn't rise high enough to qualify the county or the state for a disaster declaration, which would have made residents eligible for state or federal financial assistance.

"We calculated between $1.5 [million] and $2 million in reportable damage, but the threshold for the state is much higher than that," Tittle said.

Julie Lochmaier, spokeswoman for Lakeshore on the Hill Apartments, said repairs on 49 apartments that were evacuated shortly after the tornado have gone more quickly than expected. Two buildings were closed after the tornado ripped away roofs and concrete blocks from the third-floor apartments.

"We do have code upgrade insurance on our apartments," she said, adding that most of the 80 people displaced have been able to move back in.

"We're hoping to have the remaining 10 or 12 apartments done by Thanksgiving," she said.

Stanley said he has no complaint with Farm Bureau Insurance and that Zimmerle has been very helpful.

"I went ahead and hired contractors to replace the roof even before the insurance adjuster ever got there, because I knew this rain was coming, and I needed to save what I could of this house. He said that was no problem. My neighbors don't have roofs yet, and they're tarped over. Some haven't even gotten adjusters yet, and it's been over a week," Stanley said.

Zimmerle said many people think they have to wait for an adjuster, but that's not the case.

"If they take photographs, pay for work, and get a (itemized) receipt, we'll reimburse them for that cost," he said.

But Stanley questions why he and perhaps other homeowners don't know about the gaps and misunderstandings about "replacement" insurance.

"There's a rider that covers that (gap). The insurance commissioner told me that," Stanley said. "If I'd known there was an insurance policy against that, I would have bought it."

Contact staff writer Pam Sohn at psohn@timesfreepress.com or 423-757-6346.

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