My furnace gave out, the insurance said they wont cover due to old electrical panel. I just bought the home, did they Defraud my FHA loan?

Free Insurance Quote Comparison

 Secured with SHA-256 Encryption

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Full Bio →

Written by

UPDATED: Feb 25, 2018

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

Insurance Question from Cimarron Hills, CO

Asked on 02/25/2018

My furnace gave out, the insurance said they wont cover due to old electrical panel. I just bought the home, did they Defraud my FHA loan? 1st time home owner, havnt been living here a year, my furnace gave out, they stated they would credit me $1k, now they are not because of an old electrical panel (Main).

Answer given on February 26, 2018

A furnace that “goes out” is not usually covered by a homeowner insurance policy. It is possible that you have a home warranty insurance policy.  That is not a “standard” insurance policy, so you need to review the actual policy to see if this sort of thing is covered by that policy.

If the furnace failed due to an electrical problem, such as a surge, your homeowner insurance policy may cover it. However there is a deductible that will apply.  Contact your homeowner insurance agent or company to see if they will pay for the damaged furnace. 

In either event, there is no fraud to the loan you have.  The home warranty policy is an optional policy, so not required by FHA.  The standard homeowner policy is specific in what they do or do not cover, so again no fraud is involved in this situation.

IMPORTANT NOTICE: These answers are for general information purposes only and are provided by the person answering and AS IS. It has not necessarily been reviewed by the management staff of nor is it binding any insurance agent, broker, or other insurance professional or any attorney or insurance company. Insurance laws, regulations and practices vary from state to state and insurance policies and practices differ from company to company, by type of policy, by state and locality and by type of insurance. Tiny variations in the facts, policy language or a detail not set forth in a question often can change the outcome or a professional's conclusion. Although has confirmed that the answer(s) was/were provided for the account of an experienced insurance professional, that professional may not be licensed in the state referred to in the question, and may not be experienced or up to date in the subject area. Unlike the answers provided here, upon which you should NOT rely, for personal advice you can rely upon we suggest you consult a licensed insurance professional in your area or retain a licensed attorney listed on to represent you.

Free Insurance Quote Comparison

Enter your ZIP code below to compare cheap insurance rates.

 Secured with SHA-256 Encryption