You bought a home that required all your savings, but it was worth it for your dream home: then an unforeseen catastrophe strikes and the home you dreamt of suffers significant damage.
Luckily, you have homeowners’ insurance. You file a claim to fix your damaged dream home, but your insurance company claims that your policy does not cover the damages to your home. If you accept the insurer’s decision, you cannot afford to repair the damages.
If you have been denied an insurance claim for damages to your home, or if you are curious about what you would do if you were to be denied, take a look into the inner workings of property coverage insurance disputes, and reach out to an experienced insurance lawyer.
What Does a Standard Homeowners’ Insurance Policy Cover?
Although homeowners’ insurance policies vary from company to company and policy to policy, most policies have:
- Dwelling coverage: This covers your home’s structure.
- Personal property coverage: covers your personal items inside the home.
- Liability protection: this coverage prevents you from being liable for injuries or property damage incurred by other people.
- Additional living expenses coverage: this part of your policy pays your living expenses in the event that your home is temporarily uninhabitable.
Why Would Your Homeowners Claim Be Denied or Lowered?
A homeowners’ insurance policy is much like any other type of insurance policy. It has what it does and does not cover, and it has limits to what it covers. There are also different types of coverage. For instance, there are two types of personal property coverage: replacement cost and actual cash value.
A replacement cost policy will pay the amount of money the replacement item costs at the time of your claim. Thus, if the new item that will replace the old item costs $1,000, the policy will pay that amount, even if you paid less for the original item. An actual cash value policy simply will pay the depreciation value of the item.
Each type of personal property coverage also has its limits. It is important, therefore, that you read the details of your policy to avoid the frustration that comes with being denied or not receiving the amount you expected.
As with any insurance policy, there is an insurance company behind it that is not always willing to pay out the amount of money for which you were hoping. There may be a dispute as to the amount of damage incurred or the cost to repair it. Remember that an insurance adjuster will assess the damages and will recommend a payout amount to the company.
An insurance company might offer you a lump-sum settlement. You have the option to refuse it or accept it. The reasons for the settlement should be made clear by the insurance company based on the adjuster’s recommendation. You have the right to review the recommendation, as well as the right to hire a third-party investigator who could help you with your decision to accept the offer or not.
It may come as a surprise to you when you talk to your insurance company, but your policy might not cover what you thought it did. It comes down to the simple fact that homeowner policies do not cover all events or causes of damage. This is a common misunderstanding for many homeowners when it comes to a homeowners’ policy.
As with a car accident claim, your homeowners’ policy has a filing deadline attached to it. Missing the deadline could cause your claim to be flat-out denied. You should always file a claim immediately following the incident that caused the damage. Remember that an insurance adjuster is going to assess the damages anyway, so you will have time to have your own appraisal done.
Not supplying your insurer with the proper documentation to support your claim could also end up in a denial. Photos, videos, and witness statements, for instance, are critical for insurance adjusters to decide on your claim. Basically, you should throw in as much supporting evidence as you can. The more you show, the more chance you will have to succeed in your claim.
What Options Do You Have If Your Claim Is Denied?
The first step you need to take when denied your claim is to thoroughly review your policy. It may result in an ah-ha moment in which you realize that your policy clearly states that it does not cover the item or event you thought it did. For instance, earthquake and flood damage are typically not covered and require a separate policy.
Clearly check your claim submission process as outlined in the policy. You may have simply submitted your claim in an incorrect manner, which should allow you to resubmit your claim. Nevertheless, make sure to speak with your insurer before you resubmit to make sure you fully understand what needs to be done.
Before taking any further action, make sure you have all your supporting evidence. There might be something you left out that could be added, and you might also want to take new photos or videos, as well as document any witness statements.
It might be time to hire another set of eyes. A public insurance adjuster could be of great assistance to you. Public adjusters have no ties or affiliations with insurance companies. They will help you through the process, helping you to arrive at a settlement. Remember, however, that hiring an independent party will cost you a percentage of your claim without being able to guarantee you a settlement.
You also want to make certain that you hire someone who comes with good qualifications. It is best to contact your state insurance department to confirm your adjuster’s qualifications and track record. A recommendation from a friend or neighbor is also helpful.
One way to find a public adjuster is to contact the National Association of Public Insurance Adjusters (NAPIA). They list all licensed public adjusting firms in your area according to zip code.
If you have hired a third party to help you, and your insurance company still will not budge, you can contact your state insurance office. They can help you by launching an investigation into your claim to see if your insurer has breached your contract, treated you unfairly, or failed to abide by the state insurance laws. A state office can also advise you as to any available resources that you have not already taken advantage of.
Last but not least, you can hire a lawyer who specializes in insurance disputes. A lawyer can help you with certain factors that could affect your claim, such as contract and language interpretation, contract definitions, mitigation of damages, proof of loss, indemnification requirements, and more.
Plainfield Insurance Lawyers at Herold Law Represent Homeowners in Insurance Disputes.
If you feel that you have been wrongfully denied your homeowners insurance policy claim, you need a competent lawyer to help you through the process. Our experienced Plainfield insurance lawyers at Herold Law will work hard to bring you the settlement you deserve. Call us at 908-647-1022 or contact us online. Located in Warren, New Jersey, we represent clients in Warren, Plainfield, and throughout New Jersey.