What To Do If Your Home Insurance Claim is Denied
Created by FindLaw's team of legal writers and editors | Last reviewed March 06, 2017
A home is often a person's single largest investment, greatest asset, and most important material possession. Home ownership creates a significant amount of risk, however, so most homeowners will acquire home insurance. An accident can result in the damage or destruction of a home, or an injury occurring on the premises can leave the homeowner liable for damages. What can you do if your home insurance claim is denied? The following article covers some important considerations following a home insurance claim denial.
Why Was The Home Insurance Claim Denied?
The reason given for a home insurance claim denial has significance when determining your options. Insurers may refuse your claim if:
- The damage is not covered by the insurance policy;
- The damage occurred outside of the insurance coverage period; or
- The insurer failed to meet a condition of coverage.
The insurer's denial isn't the end of the story though. If the denial is based upon a misunderstanding of the facts you may be able to resolve the matter by sending a rebuttal of the denial, along with evidence supporting your position.
Since most of the reasons for a home insurance claim denial relate to the insurance policy itself you will need to closely examine your agreement to determine whether there is a basis for such denials. Understanding the terms of your agreement will direct both your initial response to a denial as well as provide focus for a subsequent lawsuit.
Review Your Home Insurance Policy Documents
If your response to a home insurance claim denial fails to change the insurance adjuster's decision you may need to file a lawsuit in order to recover the payment you are owed. This means showing how the insurer breached their agreement to indemnify you in the event of a covered accident. The agreement establishes the scope and period of the coverage, so it will necessarily be an important tool in formulating an appeal or respose.
You should pay particular attention to your insurance policy's "Exclusion Clause." This is the part of the policy document that inddicates the sort of events the insurer does not cover under a standard policy. Insurers frequently exclude events such as earthquakes or flooding under standard home insurance policies and coverage of these events would have to be added by the insured.
Bad Faith Denials and Causes of Action
An insurer who is seeking to avoid their obligation to pay a legitimate claim has made a bad faith insurance denial. In addition to suing for breach of contract, some states provide either a statutory or common law right to sue for bad faith insurance denials as a tort.
It is worthwhile to determine whether tort actions are available within your jurisdiction. Tort claims often permit punitive damages, which can exceed the amount of the claim itself, attorneys fees, and other enhanced penalties.
Get a Review of Your Home Insurance Claim Denial
If your home insurance claim has been denied it may be difficult to determine whether it makes sense to file a lawsuit. Fortunately, lawyers are professionally trained to assess claims and can answer questions about the local laws relating to insurance claim denials. Contact a local attorney for a free claim review to learn more about what you can do to protect your most valuable investment.
You Don’t Have To Solve This on Your Own – Get a Lawyer’s Help
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.