Co-Author: Caroline Young, Law Clerk
Your tenant has used methamphetamine at your property and now you are stuck footing the bill for costly remediation and testing. Does your homeowners insurance policy cover this damage? Even if a tenant only uses meth on your property and does not operate a meth lab, your property may test above the legal limits for meth requiring costly remediation and re-testing under the law. As the property-owner or landlord, you want to investigate if insurance will cover this expensive process. Sadly, you will likely receive push-back from the insurance company, even if your policy does not contain language that excludes coverage for damage caused by illegal drug use by any person. In order to receive the compensation you may be entitled to under your policy, you need to put yourself in the best position to negotiate with your the insurance company. Let our team help you by reviewing your policy.
Most policies will cover acts of vandalism, but it is best to review your policy and make sure vandalism is included in your policy. Certain policies will also refuse to cover certain acts categorized as “exclusions.” For example, insurance may not cover acts of vandalism if the home was vacant for 30 or 60 days (depending on the policy). While your policy may mention vandalism as a covered “specified cause of loss,” the policy may fail to clearly define vandalism within the policy. Some policies will find that acts of spray painting, egging, and breaking lights or windows constitute vandalism. However, the question of whether drug use by a tenant qualifies as vandalism remains unsettled by many courts.
Colorado courts have not yet specifically addressed whether methamphetamine use or manufacturing by renters is insured under a homeowners insurance policy that covers vandalism. Colorado courts have clearly outlined what vandalism means: vandalism is the willful and malicious destruction of private or public property. Herod v. Colorado Farm Bureau Mut. Ins. Co., 928 P.2d 834 (Colo. App. 1996). Colorado courts have also stated that the intent to damage the property may be inferred from the act itself.
Other courts across the country have concluded that the operation of a meth lab by renters constitutes vandalism and thus should be covered under a homeowners insurance policy. Graff v. Allstate Ins. Co., 54 P.3d 1266 (Wash. App. 2002). There, the court concluded that the renters’ use of the meth lab was vandalism because the act was intentional, in disregard of the owner’s property interest, and the resulting damage was almost a certainty. Id. Applying this definition to meth use, the court concluded that an indoor meth lab created harmful vapors and residues that, of course, damaged the rental property. Id. Similarly, while the cases regarding meth use are slim, courts have ruled in various cases involving other drugs and their connection to vandalism. In Bowers v. Farmers Ins. Exchange, 991 P.2d 734, the Washington court concluded that the tenant’s operation of a marijuana grow operation in a rental house was the proximate cause of mold, and thus, the damage fell within vandalism coverage and should not be excluded as mold damage. (Wash. App. 2000). By contrast, in Michigan, the tenant’s operation of a marijuana grow operation in a commercial property did not constitute vandalism under the landlord’s insurance policy. K.V.G. Properties, Inc. v. Westfield Ins. Co., 296 F. Supp. 3d 863 (E.D. Mich. 2017).
Contact Cindy with your questions about homeowner’s insurance to see if meth or other drug use is covered under your policy.
For more interesting reads about drug use covered as vandalism under homeowner’s insurance see: When Meth’s been at home.
Cindy Manzano teaches a class to real estate brokers on meth called Meth Labs, Disclosures, and Remediation in Colorado through Educated Minds.
For additional information please also read the following article by Cindy Manzano: Meth Labs and Properties for Sale.