Denied Home Insurance Claim, Now What?
If your dissatisfaction stems form the conduct or non-responsiveness of the adjuster assigned to your claim, be sure to write a letter to your adjuster. A letter can be directed to specific individuals who are influencing your claim.
Some state insurance departments offer mediation services. In addition, most policies allow for an independent appraisal or arbitration process to resolve disputes over money. The decision of the appraiser or the arbitrator is often binding. The decision, however, doesn’t always close the door to mediation or litigation on other issues, such as “bad faith.” It is an important point to continually maintain your claim file. This file may prove invaluable if your claim is contested or if you bring forth an action of bad faith.
Contacting the Insurance Commissioner
Each state has an Insurance Commissioner. Most commissioners are appointed by the Governor of the state, although some are elected officials. The Insurance Commissioner’s office is given the task of monitoring the activities of insurance companies, assuring proper compliance with state laws regulating insurance companies, and evaluation whether the insurance companies are solvent.
If you have any kind of question or problem regarding insurance in general, or a claim in particular, the Insurance Commissioner’s office is available to offer you assistance. If you have a valid complaint against your insurance company, or you feel you are not being treated fairly, the Insurance Commissioner’s office will investigate the issue. If there is a problem with your claim, the Insurance Commissioner’s office can be a powerful force. Contract your own individual state’s Department of Insurance and request to speak to someone on the staff of the Insurance Commissioner.
Alternative Remedies – Appraisal, Arbitration, Lawsuit
Perhaps the most neglected section of any homeowner policy is the “Appraisal Clause.” It can be found under the “Conditions” portion of any property insurance policy. It is such an important section of the policy for you, the policyholder, that it bears close scrutiny.
The appraisal process is usually the most economical procedure to take rather than to immediately seek legal counsel. There is no guarantee that the appraisal will allow you to settle with the insurance company for the amount you feel is fair and reasonable for your damages. But, there is a good chance that you will at least settle far better than you would have if the appraisal process was not initiated at all.
If your policy contains an appraisal process clause, your insurance company might try to force you in to the appraisal process. They may possibly send you an “official looking” letter saying you have 20 days or less to retain an appraiser. Do not be intimidated by this kind of pressure. A letter notifying you of your right to the appraisal process is not necessarily a demand by the insurance company to engage in one. You have the option to initiate the appraisal process but so does your carrier. The carrier will rarely initiate the appraisal process, but if they do, take not of the time for you to respond.
If you decide to enter the appraisal process and are dissatisfied with the outcome of the appraisal decision, you can sue your insurance company. Keep in mind if you elect to sue, that the absence of evidence of wrong-doing on the insurance company’s representative part during the appraisal process, will be vigorously defended by your insurance company and can be very expensive.
Home Insurance Claim Arbitration
If there is not a mandatory arbitration clause in your policy, and your disagreement is based on the value of the claim, you can request arbitration with your insurance company. If arbitration is agreed upon by both parties and your policy has an arbitration provision, then you both must agree as to whether the decision of the arbitrator will be binding or non-binding. If the parties decide that the arbitration ill be binding, then the decision of the arbitrator will be final. If, however, the parties decide that the decision of the arbitrator will be non-binding, and you or your carrier receives an unsatisfactory result, you can elect to file a formal lawsuit and proceed to trial. Arbitration rules vary from state to state so it is a good idea to consult legal counsel when selecting this course of action.
After you file a lawsuit, a judge will review the case and determine the value of the claim. Next, based on the amount o the damages, the judge can determine whether the case may be arbitrated or tired in a court of law.
If the judge sends the case to arbitration, the parties must agree as to whether the decision of the arbitrator will be binding or non-binding. (If an agreement cannot be reached, the decision will be non-binding). As in a non-judicial arbitration, a binding decision is final. If, however, the decision of the arbitrator will be non-binding, and you receive an unsatisfactory result, you can then request a “Trial de Novo,” and the case will be put back into the trial court and either settled or tried. Arbitration is an alternative solution to a potentially costly trial.
Lawsuits are the absolute last resort if you have a dispute with your insurance company. Lawsuits are very expensive and demand a high level of commitment of your time and resources. They are often high-risk contests that usually don’t compensate for the economic loss you will have suffered as a result of the money you will have invested in bringing the lawsuit. You may be justified in filing a formal lawsuit if you have suffered a major loss and your insurance company is continuing to deny your claim.
A final note: Your insurance company is obligated to notify you (after you have filed a claim) of an impending statue of limitations deadline. Generally, you have within one year form the date of loss to file a formal lawsuit, However, you should consult legal counsel or check with your state’s Insurance Commissioner’s office to determine the applicable statue of limitations, to ensure you are filing your lawsuit in a timely manner!
Homeowner Insurance Quotes
If you're unhappy with your home insurance company, feel they do not have your best interests at heart, or think you may be overpaying for the coverage and service you are receiving, homeowners can always find and compare home insurance quotes online. NationalLenderList.com provides homeowners with access to many of the top best home insurance companies in the country and can help owners get cheap home insurance quotes and make the switch to a better insurer.
Read more about "Finding and Selecting Your Appraiser" for the litigation of your home insurance claim.