Why Property Damage Claims Get Denied and How to Fight Back
You pay your insurance premiums month after month so you don’t have to worry when unexpected events damage your home or belongings. When an insurance company denies that legitimate claim, they steal that peace of mind and leave you with thousands (or hundreds of thousands) of dollars to pay by yourself.
If denied property insurance claims are leaving you feeling helpless, Palker Law Firm is here to help. Use this step-by-step guide to both understand why your claim might be denied, and how to fight back to get every dollar of compensation you deserve.
5 Reasons For A Denied Property Insurance Claim
Denied claims can stem from various issues, including policy exclusions, insufficient documentation, or missed deadlines. Insurers often cite reasons such as lack of coverage or homeowner negligence to justify denials. Here is a look at some of the more common reasons insurers say “No” to property damage claims.
Insufficient Documentation
One of the primary reasons property damage insurance claims are denied is due to insufficient documentation. Insurance companies require detailed evidence to substantiate claims, including photographs of the damage, repair estimates, and receipts for any related expenses. Without the right proof, insurers may not be able to validate the damage to your property.
Late Claim Filing
Even if you do document the incident and submit it, you may receive a denial if you registered your claim too late. You normally only have a certain amount of time to make your claim before the insurance company can automatically deny it.
Policy Exclusions
Insurance policies come with a myriad of exclusions that can lead to claim denials. Common exclusions include damage caused by natural disasters like floods or earthquakes, which often require separate policies. Exclusions typically include wear and tear, mold, and pest infestations. Policyholders may overlook these exclusions when filing claims, leading to denials.
Lapsed Policies or Non-Payment
A claim can be denied if the insurance policy is no longer active due to non-payment of premiums or if it has lapsed. Insurers have strict guidelines regarding the timely payment of premiums to keep the policy in force. Failure to pay on time or allowing the policy to lapse results in loss of coverage, and any claims made during this period will be denied. Homeowners should ensure they keep their policies current and pay premiums promptly to maintain coverage.
Failure to Mitigate Damage
Insurance policies typically require policyholders to take reasonable steps to mitigate further damage after an incident. If an insurer determines that the homeowner did not take adequate measures to prevent additional damage—such as failing to make temporary repairs or neglecting to secure the property—they may deny the claim. For example, if a homeowner fails to cover a damaged roof leading to further water damage, the property damage may be denied.
Step-by-Step Guide to Disputing a Home Insurance Claim Denial
- Review your policy and denial letter
When faced with a denied property insurance claim, the first step is to thoroughly review your policy and the denial letter to ensure the damage should be covered. This review helps identify the insurer’s reasons and evaluate if there are valid grounds for the denial.
- Evaluate the insurer’s reasons for denial
Identify the specific grounds the insurer used to deny the claim and assess if they are valid.
- Gather supporting documentation and evidence
Collect photos, videos, maintenance records, contractor verifications, and other documents that support your claim.
- Submit a written appeal
With this evidence in hand, submit a written insurance claim appeal to your insurer, detailing your case and including all gathered documentation
- Consult an independent appraiser or public adjuster
If Step 4 fails to resolve the issue, consider obtaining an independent appraiser or hiring a public adjuster to provide an unbiased assessment of the damages and assist in negotiations.
- Consider hiring a lawyer
If previous steps don’t resolve the issue, consult a lawyer for further legal action or to negotiate a settlement.
- Review dispute and appeal processes
Research additional resources on claim dispute and appeal procedures to ensure you’re following best practices.
Each of these steps can increase your chances of successfully overturning a denial and getting every dollar you are owed.
How a Lawyer Can Help You Fight Back Against Denials
A lawyer can be instrumental in fighting back against a denied property insurance claim by helping you thoroughly understand your policy and the specifics of your claim. They can ensure that you’re fully aware of the coverage and exclusions that apply, which is vital in understanding why your claim was denied in the first place.
With their expertise, they can also assist in filing a complaint with your state insurance department if you believe the denial was unjust, leveraging their knowledge of state insurance regulations.
In situations where initial negotiation with the insurer fails, a lawyer can enter mediation on your behalf. Mediation involves an impartial third party and, although nonbinding, can often lead to a mutually acceptable resolution.
Should mediation not yield satisfactory results, your lawyer can escalate the dispute by filing a lawsuit and taking your case to court, aiming to ensure you receive the compensation you are entitled to.
Throughout the insurance claim appeal process, having legal representation can significantly improve your chances of a favorable outcome.
4 Tips for Avoiding Property Insurance Claim Denials
Understanding your policy, documenting damages, promptly notifying your insurer, and protecting your property increases the likelihood of a successful insurance claim.
Understand your policy’s coverage and exclusions
Know what is covered and what is not to set realistic expectations and avoid disputes.
Review your policy documents and consult your insurer with any questions.
Thoroughly document damages
- Take photos, videos, and keep receipts and maintenance records to have strong evidence to support your claim.
Notify your insurer promptly
- Report any damage to your insurer as soon as it occurs to avoid claim denial due to late filing.
- Quick action helps expedite the claims process and shows your commitment to resolving the issue.
Protect your property from further damage
- Take immediate steps such as securing broken windows or covering damaged roofs to prevent additional damage.
- Proactive efforts minimize losses and demonstrate responsibility to your insurer.
Ultimately, being well-prepared and informed can determine how your claim turns out. Don’t let insurance fine print deprive you of what you rightfully deserve.
At Palker Law Firm, we fight relentlessly to ensure you get the compensation you’re entitled to. With a proven track record, including the largest residential storm damage judgment in Texas history, our tenacious team is ready to tackle your residential or commercial property damage claims.
Led by Jason Palker, recognized as a top attorney nationwide, we offer a free case review, and you pay nothing until you win. Contact us now and let us champion your cause!
