Fiona fallout: Insurance dispute has kept N.S. single mom, son out of their home for 2½ years

Claudia Sheehy and her son, Ciaran, moved into their home in Grand Lake, N.S., three years ago.

With a half hectare of land overlooking the lake, a park within walking distance and a nearby farm where she hoped her son would take horseback riding lessons one day, she had their future mapped out.

"It's just beautiful out here," said Sheehy. "If you could see the sunsets, the view just being on the water, [the great] neighbours, it's everything I would want a little boy to have growing up with."

But post-tropical storm Fiona in September 2022 tore part of the roof off their Halifax-area home. That set in motion a chain of events that has kept the family of two out of their home because of problems with the insurance claim, all while Sheehy has racked up roughly $60,000 in credit card debt to keep afloat.

She said her insurer, Allstate, hasn't paid her for items like living expenses and the cost of emergency repairs since December 2022. That total is now more than $100,000.

Sheehy and her son, now four, have mostly lived in Airbnbs and hotels since the storm.

When it rains or snows, water pools inside the home. When CBC News recently visited the home, the signs of water damage were visible with dark discoloration throughout and a mouldy smell.

The stress of the experience has taken a toll on Sheehy's health. She was off work for a year on medical leave. She said she still struggles with anxiety and depression.

"I feel like I've lost the last few years with my son because ... it's just been us moving and trying to just make it, instead of us building a life together," she said through tears.

After Fiona, a company installed sheathing and an ice/water shield to prevent further damage to the home, but Sheehy said water continued to get in the house whenever it rained.

But another powerful storm in November 2022 tore parts of the roof off again. Temporary repairs were done on the roof and to prevent a wall from collapsing.

The company who had been doing repairs for the first job — who was recommended by Allstate — stopped doing the work.

Sheehy was told she'd have to find a company to do the work. But she had trouble getting quotes, in part because of how busy firms were doing repairs after Fiona.

The permanent repairs have not been done because of a disagreement over how much the repairs should cost, said Sheehy.

A repair estimate from a company that was a preferred Allstate vendor said the repairs to fix the damage from the two storms would cost around $74,000, said Sheehy, while quotes she obtained were over $300,000.

With each passing day, she believes the home will need to be demolished and rebuilt.

Frustrated by her experience, Sheehy filed an appeal with the company's ombudsperson in December 2022. Six weeks later, she received an email in return saying that steps to cover the damage "have been identified and will be addressed."

Lawsuit

Sheehy hired a lawyer and sued Allstate in Nova Scotia Supreme Court in September 2023.

"This is a horrible case," said Barry Mason, Sheehy's lawyer. "It's one of the worst that I've seen in 30-plus years of practice and has had a devastating impact on Claudia — who's been incredibly patient — and her family, and getting back into their home."

In a statement, Allstate said it has high standards for customer service and has been in regular contact with Sheehy.

"Throughout the claims process, we have continued to honour the terms of the customer's insurance policy. We look forward to resolving the customer's claim as we work with them through the stages of the claims process," it said.

The legal action has effectively been paused because Allstate invoked something under the provincial Insurance Act known as the appraisal clause.

This happens when two parties disagree about the value of a claim, so each hires an appraiser to determine the claim value. If the two appraisers disagree, a party known as an umpire is brought in and the amount they determine is final.

Mason said this process places the insured at a disadvantage.

For one, Sheehy will have to pay for the services of an appraiser, which could cost her at least $8,000. If the matter needs to be resolved by the umpire, Sheehy would have to pay half. Mason said an umpire could cost around $10,000.

Sheehy said her appraiser submitted information to Allstate last December. She said that the company's appraiser visited her home last September, but has not filed anything since.

Once the insurance claim is sorted out, Mason said the legal action will resume.

"Insurance companies are under an obligation to promptly deal with claims like this and to assist their insured with processing the claim," said Mason. "In our view, they completely failed Claudia in that respect."

Mason said they will be seeking bad faith claims to cover things such as punitive damages (money an insurer pays as punishment for being unfair) and aggravated damages (money an insurer pays for being unfair and causing the insured emotional distress).

Allstate said it could not discuss the legal proceedings.

Sheehy said the ordeal has changed her.

"I'm not the kind of person that cries," she said through tears. "I'm not the kind of person that dwells on the negative or suffers from depression or anxiety. I make plans for the future, so the move here had amazing plans.

"And now we're what, three years later, and I'm five steps back instead of being where I should be."