Most denied claims are not about the insurance company saying “no” – they are about misunderstandings. A knowledgeable agent can help you avoid these pitfalls before something happens. They are just as concerned about you understanding the coverage you are purchasing as they are about saving you money.
“We are here before, during, and after your claim is complete. When purchasing coverage, we point out differences in coverage between your current coverage and what is available from our carrier partners. We can help answer questions about the coverage of potential claims before filing, and we have an internal claims department to assist with the claims process and who can step in to advocate for you when necessary.”
— Lynn Swink, Director of Personal Lines
Not Filing on Time
Notify your insurer promptly of any loss and understand there are time limits for filing a claim, often 6-12 months.
Not Taking Sufficient Preventive Measures Following a Loss
In some cases, such as water-related claims, where damage can spread when you neglect to file right away or take measures to mitigate the damage, coverage could be denied or capped. There are often limitations on the amount that will be paid out for water and mold claims, because at some point, the spreading damage is due more to negligence than to what initially caused the claim.
Not Completing All Steps in the Claims Process
After you initially file the claim, there are other steps that they will direct you to take, such as getting estimates of the damage, signing paperwork to allow repairs, paying your deductible, or showing proof of repairs for a final payment to be issued for the full replacement cost of the repair.
Non- or Late Payment of Premiums
If your policy has a lapse in coverage, carriers will generally not allow you to pay to reinstate the policy to make a claim for damage that happened while the policy was cancelled.
False Statements or Questionable Claims
Claims adjusters may investigate to determine if claims fraud has been committed, which can delay or deny the claim.
Misrepresenting Your Risk on the Application
Questions on the application are for eligibility and rating. If you misrepresent your risk by mistake or intentionally, your claim could be denied. For example, the claim could be denied if you said the house was your primary home, and a few years later, when a claim is made, they discover you are renting the house to someone else. The company may honor the claim, but they do not have to because it wasn’t rated correctly and should have been written as a landlord policy. It is crucial to ensure you answer truthfully during the quote process and inform your agent of any changes to your property over the years that may impact your eligibility or rate, so the policy can be adjusted. Common areas to update are use of the home, new dogs, pools, trampolines, business being conducted out of the home, and additions or major renovations.
Perils Insured Against and Exclusion Clauses
Know what your policy covers and excludes. Some damage that occurs may not be a covered peril. Common perils are wind, hail, lightning, theft, fire, etc. Typical exclusions are flood, earth movement, pests, acts of war, business activities, etc. Most policies have optional coverage, such as earthquake, sinkhole, water backup, service line coverage, equipment breakdown, etc. It is essential to know what your agent has quoted for you and your options for adding additional coverage.
Policy Limits
Just as water and mold often have limitations on how much will be paid, there are limitations on specific categories of personal property, especially for theft and mysterious disappearance. These areas are often jewelry, firearms, musical instruments, furs, collectibles, even tractors and zero-turn mowers. You can schedule valuable property that exceeds the underlying limits on the policy either as an endorsement on the Homeowners or a “floating” Valuable Articles policy. And with liability claims, you can have an Umbrella that gives additional liability coverage if your underlying limits are exhausted. Umbrellas cover additional liability for all policies in addition to Homeowners, such as Auto, Watercraft, ATV, Landlord, etc.
Is your homeowner’s insurance policy up to date? A review can ensure you’re covered and getting the best value. Contact us for policy review.
