Hoarding disorder affects an estimated 2-5% of the population. The excessive accumulation of possessions can lead to unsafe and unsanitary living conditions. When a hoarding situation threatens the structural integrity or habitability of a home, extensive cleanup is often required. But does homeowners insurance cover the cost of hoarding cleanup services?
How Hoarding Impacts Insurance Coverage
Unfortunately, standard homeowners insurance policies provide very limited coverage for hoarding cleanup costs. Here’s why:
Property Damage Exclusions – Damage from long-term exposure to clutter, mildew, insects, rodents, etc. is specifically excluded.
Gradual Damage – Insurance covers sudden damage, not gradual deterioration over time.
Pre-Existing Conditions – Most policies won’t cover damages from conditions that existed before the policy inception.
Negligence – Failing to address hoarding behaviors that cause damage can be considered negligence.
Ordinance or Law – Bringing a hoarder home up to code is not covered.
Professional Services – The cost of cleanup crews is not covered.
Liability Claims – Injuries on the property due to hoarding hazards may not be covered.
Insurers view hoarding situations as high-risk because the accumulated items make losses more likely and valuation more difficult.
Will Homeowners Insurance Pay for Any Hoarding Cleanup?
While coverage is very limited, there are some hoarding-related cleanup costs that may be partially covered:
Water Damage – If a pipe burst and caused water damage to the home and contents. But only sudden damage, not long-term leaks.
Fire Damage – Flammables make hoarder homes high risk for fires. But coverage depends on the fire’s cause and if hoarding contributed.
Collapse – If the weight of accumulated possessions caused a floor or wall to collapse. But prior damage or deterioration would not be covered.
Rodents – Pest removal and damage repairs if a rodent infestation was sudden and traceable to a specific covered incident.
Liability – Injuries to visitors that result solely from a standard covered peril like a slip on a rug. Hoarding cannot contribute.
Even with these limited scenarios, don’t expect the insurer to pay for full-scale cleanup. The hoarding disorder itself will not be covered, only the sudden covered loss event.
Will Hoarding Cleanup Be Covered After I Purchase a Policy?
Do not expect a new insurance policy to cover cleanup costs associated with a pre-existing hoarding condition. Insurance is designed to cover damages that occur after the policy start date.
Insurers will investigate the onset of hoarding behaviors. If the clutter, structural damage, or unsanitary conditions existed before you purchased the policy, the claim will likely be denied.
New policyholders should thoroughly document the home’s condition with dated photographs and video. But even then, hoarding-related damages arising after coverage starts will likely have limited payouts.
Does Renters Insurance Cover Hoarding Cleanup?
Renters insurance provides limited personal property coverage but will not pay for cleanup costs in a rented hoarder home. The landlord’s property insurance may provide some coverage for water or fire damage to the building itself.
However, damages from hoarding behaviors that violate the lease agreement would not be covered. Renters should review their lease to understand responsibilities for keeping the unit clean and sanitary.
Strategies to Get Insurance to Cover Hoarding Cleanup
While hoarding cleanup coverage is limited, here are some tips to potentially get insurers to pay for some costs:
Clearly document that the hoarding disorder began suddenly after policy inception.
File claims as soon as new damages occur; don’t wait until the situation deteriorates.
Emphasize sudden, large-scale covered losses versus long-term damage.
Get third-party documentation the home met safety codes before the claimed loss.
Negotiate reasonable settlement offers instead of maximum payouts.
Offer to have cleanup crews sort out and return undamaged valuables.
Suggest a mediator for disputes about what is or isn’t covered.
Research the insurer’s specific policies on hoarding claims; some may offer slightly broader coverage.
Are Hoarding Cleanup Costs Tax Deductible?
If insurance will not cover hoarding cleanup, the costs may potentially be tax deductible in certain situations:
If the home is used for business purposes, cleanup and repairs could be deducted as a business expense.
Costs incurred to make the home compliant with applicable health and safety codes may be deductible.
Expenses to improve accessibility and mobility within the home for medical reasons may qualify.
Payments for mental health treatment related to the hoarding disorder may also be deductible medical expenses.
Consult a tax professional to understand current IRS rules on deducting hoarding-related costs for both personal residences and business properties.
Using a Trust to Pay for Hoarding Cleanup
Some families use trusts to finance hoarding cleanup costs:
A special needs trust pays for support services for people with disabilities without impacting government benefits. Hoarding treatment and cleanup expenses could potentially be paid from the trust.
Upon death, funds from an estate can be placed into a trust earmarked for restoring a hoarder’s home to make it saleable.
Family members can contribute funds to a living trust designated solely for hoarding cleanup purposes.
An estate planning attorney can provide guidance on structuring a trust that legally and ethically pays hoarding-related expenses.
Is Hoarder Cleanup Insurance Available?
A few specialty insurers like Lloyd’s of London offer supplementary insurance policies specifically covering professional cleanup costs for extreme hoarding situations.
This type of policy provides last resort coverage when damage from hoarding behaviors makes a home uninhabitable and homeowner’s insurance will not pay for required services.
Premiums are expensive and coverage limits low, but for desperate situations, it can be the only option to finance cleanouts. Brokerages specializing in hard-to-insure properties may have access to this type of coverage.
Using Personal Liability Insurance for Hoarding Cleanup
Personal liability coverage on home or renters insurance policies may potentially cover injury claims if a visitor trips over clutter and gets hurt. However, the policy excludes paying for the actual cost of cleaning out the hoarded home.
If poor property maintenance contributes to an injury, the liability claim could also be denied. Liability insurance only covers freak accidents, not damages clearly caused by long-term negligence.
Is Mandated Hoarding Cleanup Covered by Insurance?
Local authorities like health departments can mandate cleanup if hoarding poses risks to public health and safety. But government-ordered remediation is never covered by insurance.
Policyholders are responsible for compliance costs unless the hoarding itself stems from a disability that requires reasonable accommodation under the Americans with Disabilities Act. Even then, insurers will not pay directly for court-ordered cleanouts.
Using Household Insurance to Replace Possessions
If a fire, flood or other large-scale covered loss destroyed many possessions in a hoarder’s home, the homeowners policy would pay actual cash value to replace belongings. This benefit could potentially fund some level of hoarding cleanup.
However, items that were already broken, contaminated or unfit for use would receive no replacement value. The insurer will not replace damaged or unsanitary items that were not functioning as intended before the loss.
Does Insurance Cover Hoarding Treatment?
Mental health coverage, whether through private insurance, Medicare/Medicaid, or an employee assistance program, may cover therapeutic treatments to address hoarding behaviors.
Treatment is often the most long-lasting solution, as cleanup does not resolve the underlying compulsive habits. Insurers want to avoid repeat cleanouts, so supporting therapy aligns with their goals.
Consult a mental health professional on evidence-based talk and behavior therapy plans for hoarding disorder. Insurance pre-approvals and provider referrals can streamline using benefits.
FAQ: Homeowners Insurance and Hoarding Cleanup
Does homeowners insurance cover extreme hoarding cleanup?
No, standard policies explicitly exclude coverage for cleanup costs related to hoarding behaviors or the accumulated possessions. Only sudden large losses from a separate covered peril might be partially covered.
If my house burns down, will insurance pay 100% to clean and rebuild?
Not if pre-existing hoarding contributed to the extent of fire damages. The insurer will investigate cause and only pay for sudden fire damage, not removal of excessive clutter and other long-term issues.
I want to sell my hoarder parent’s home. Will insurance cover cleanup costs?
No, insurers will not pay simply to make the saleable home more attractive to buyers or up to neighborhood standards. Selling motivations do not constitute a covered loss.
A wall collapsed under the weight of stored items. Will insurance pay for repairs?
Maybe. If this was sudden and no pre-existing damage or
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