Failing Home Foundation

by Jen
(North Carolina)

Our 4 yr old home has a huge crack in the foundation that is large enough to put your entire hand in! Our builder went bankrupt. We have filed a claim for Property damage with Erie Insurance against the contractors general liability insurance. He built and our county passed 3" footers that are supposed to be 12" footers. We have had an engineer out and he dug up footers and found one with huge crack. Non compacted soil is settling as well. Electric garage doors are off kilter garage floor cracking. Estimates to jack up house and build retaining wall are about $75,000. I filed a complaint with NC Insurance Dept after Erie stalling us for 13 months with bogus reasons for delay and Erie said they would settle. When I emailed Erie $13,380 was their offer. They do not cover builders defective work only what his defective work has damaged. This offer makes no sense at all. It covers for importing dirt for retaining wall and cleanup!! And they said retaining wall itself wouldn't be covered.My position in writing back was "I am not asking you to repair his footer we are not repairing his footer at all...we have to put the house back in its proper position and stabilize it . Now we got a letter stating that upon further review any settlement they make with us will have to be approved by the bankruptcy court and asking for a copy of our contract with our builder? Any ideas? I am looking for a contingency attorney as we are unable to handle the costs...

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Jan 23, 2011
Foundation issues
by: Russell Longcore

Erie is correct. The CGL policy for product and completed operations does not cover the contractor's work product, but damages due to inferior work product. Construction Defect liability insurance covers work product. But the cracks in your foundation are due to the contractor's negligence, aren't they?

I recommend that you hire your own contractor to write an estimate of the damages and repairs. Then give that estimate to Erie.

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