An elderly cancer patient whose home flooded while she was getting treatment was denied coverage from Grey Power, because she left her house in Pembroke, Ont., unattended for more than four days.
"I feel hurt and let down. They should have informed me about what I am in for," said Ivy Scotland, 84, who, by all accounts, is meticulous about paying her bills and takes pride in her home.
"I did not expect to be away from my house for any period of time."
Scotland's home is now a mess from water damage. She's facing an $11,000 repair bill, because of a little-known standard policy exclusion she said she'd never heard of.
"What I read in the policy was just that I had coverage for water damage," she said.
Insurance experts told Go Public that few Canadians are aware that if they leave their home for more than four days in the winter, without a responsible person to check the heat inside each day, home insurance won't cover water damage if pipes freeze and burst, as in this case.
Alternatively, water supply valves need to be shut off, but some policies may still require periodic checks, even with that precaution.
Homeowners unaware, says broker
"There are millions of people insured in this country — and I would suspect that maybe a couple of hundred thousand understand this part of their policy," said Monica Woldring, an independent insurance broker in B.C.
The Insurance Bureau of Canada said it doesn't have numbers, but Woldring expects this last harsh winter led to a spike in this type of claim — and this kind of denial.
"They are disastrous for most people, because it's not like the water has only dribbled."
Scotland's home in Pembroke is almost a two hours' drive from Ottawa General Hospital, where she is being treated for multiple myeloma, a type of blood cancer.
Her doctor didn't like her travelling back and forth, she said, so she reluctantly left home in November to stay close to the hospital during treatments. She had a neighbour watch the house and pick up mail, but she didn't ask him to go inside.
Three weeks after her last visit home, her furnace went out and the pipes froze and burst.
$3K per month for temporary home
"You wonder whether they are sort of complicit in keeping their policyholders in the dark about this," said the neighbour, Tom Spooner, who added that Grey Power's claim denial makes his blood boil.
He said he'd never heard of the four-day rule either. "And how many other people have ever heard of it?"
Scotland is draining $3,000 a month from her savings to stay in an Ottawa retirement home temporarily. She is also still paying Grey Power $90 a month for home insurance.
"I would love to be able to go back home, to my house," said Scotland. "I am not the only person who was caught in this situation. The weather was bad. And a lot of people had this sort of problem."
She insisted that when she bought her insurance, the person who sold her the policy said nothing about this exclusion.
"The broker should have told her. The broker should have reminded her. You have to remind people because they don't remember," said Woldring.
Compassion called for
Scotland's plumber called to plead her case, but said Grey Power showed no concern.
"I thought because they target seniors they would have had more compassion in this situation," said Peter Saffery.
There is no mention of this pitfall on Grey Power's website, even though there are other tips for seniors who leave their homes in the winter.
Go Public did a test to see if Grey Power warns potential customers who call. Posing as someone shopping for home insurance for elderly parents, we asked repeatedly what wasn't covered. Initially, we were told burst pipes would be.
"As long as you choose that coverage as part of the quote, it's a water damage extension," said the broker.
"It's usually the same exclusions are on all home insurance policies ... if a pipe leaks it's not going to be covered, but if a pipe burst it would be covered."
He also did explain this exclusion, but only after we asked about frozen pipes.
"In the winter months you need someone checking on the home either daily or if all the pipes are drained and shut off then it's every few days."
Grey Power response
Grey Power declined Go Public's request for an interview and didn't answer questions about its practices.
It sent an email, pointing out its broker "diligently" answered questions we asked him.
"We take great pride in our brokers, and they in turn take great pride in the service they provide to our customers," said a Grey Power spokesperson.
As a result of our inquiries, it also said it has now "reached out" to Scotland to try to "resolve the situation as quickly as possible."
"We are very sorry that she has had to refocus her time and energy to this matter."
Woldring said she believes customers are more in the dark about insurance than ever, because they are buying online or over the phone.
"My fear is that we are losing the humanity in our business … we are going to have more and more cases like this one … especially as people age and get ill."
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Go Public's questions and Grey Power's statement