Meth damage claim confusion
Question from Diane updated on 17th May 2017:
I discovered my rental property abandoned when I went to do a planned inspection. The house was damaged, furniture and belongings had been left behind, and testing showed meth contamination above Ministry of Health guidelines.
I have landlord insurance, but my insurance company declined my claim for decontamination. They say the levels show it wasn't a lab and that only smoking occurred - therefore the damage was gradual, not sudden or accidental. They said they would accept the claim if meth was manufactured.
Now they are saying we have to decontaminate the property ourselves. How is this fair? We have paid insurance premiums with the belief that if this ever happened we would be covered.
Our expert Myles Noble responded:
Your question highlights an increasingly common issue for landlords. Generally, insurers will only cover meth decontamination costs where the testing levels provide evidence of manufacture or storage as opposed to consumption or use, regardless of whether the Ministry of Health guidelines have been exceeded.
However, there have been recent developments where, for an additional premium, some insurers will provide cover to an agreed limit where contamination levels detected show only use or consumption. My advice is for landlords to review their existing insurance cover and ensure that they are covered for damage caused by consumption as well as for manufacture and storage.
Myles Noble is head of claims and earthquake response for Crombie Lockwood. He also holds various advisory board positions in the insurance industry.