When the exterior or roof of your home is damaged by a hurricane or hail, your homeowners policy might cover the damage.  However, the useful life of a home is long enough that materials used in the original construction might not be available when the home is damaged.  Even if the insurer agrees to repair or replace portions of a damaged roof or siding of a home, an issue may arise if there is no way to match prospective replacement materials.  If the insurer only need replace the damaged section of the roof or the siding panels that are damaged, the value of the home may be seriously impacted.

A case decided by the Minnesota Supreme Court reached a decision favorable to policyholders regarding the obligation of insurance companies to provide repairs that reasonably match pre-existing materials.  In Cedar Bluff Townhome Condominium Association, Inc. v. American Family Mutual Insurance Co., the policyholder experienced a loss caused by hail damage to a multi-unit dwelling with twenty separate units.  The siding on the units was more than a decade old, so the color of the siding had faded. 

Although the manufacturer was still in business and produced the same type of siding panels, the manufacturer could not produce panels the same color as the original panels.  Even if the manufacturer had been able to produce the same color, the panels would not have matched because of the discoloration of the original panels from age. 

The insurance policy provided coverage for “direct physical loss of or damage to Covered Property at the premises . . . .”  The policy further indicated that the insurer was to “determine the value of the Covered Property . . . [a]t replacement cost . . . .”  Replacement cost was defined as the cost to replace “the lost or damaged property with other property . . . [o]f comparable   material and quality . . . .”

The insured contended that both the damaged and undamaged siding on all twenty structures had to be replaced to prevent mismatched colors between the non-damaged panels and those that would be replaced.  The insurer argued that the language of the policy only required replacement of the damaged panels.  Because the parties could not resolve their disagreement regarding the cost and scope of repair, the matter was submitted to appraisal.

The appraisal decision found that the requirement that the damaged panels be replaced with “comparable material and quality” required replacement of all panels, including siding that did not sustain damage to prevent a color mismatch.  The appraiser found that the language referenced above required a “reasonable color match” to constitute an appropriate repair regardless of whether the panels met the same product specifications as the original panels.

The District Court granted the insured’s motion for summary judgment, but the Court of Appeals reversed.  The insured appealed the case to the Minnesota Supreme Court which ruled in favor of the appraisal decision.  The state’s highest court reasoned that the language “comparable material and quality” equates to “reasonable color match between new and existing siding.”  While the court determined that the insurer was not required to achieve an identical match, the insurer was required to achieve a “reasonable color match.”

While this decision is not precedent in Florida, our state courts often consider how other states have resolved issues when making decisions on issues of first impression.  If portions of your home are damaged, this decision can be helpful if the insurance company attempts to undertake repairs that might harm your property value because of improperly matched colors.

You can reach Miami Insurance Claims Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Attorney Gonzalez-Sirgo directly at [email protected].

J.P. Gonzalez-Sirgo
J.P. Gonzalez-Sirgo, P.A.
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