According to the Insurance Information Institute, the average amount paid out per property insurance claim is over $13,000. For everything from burst pipes to wind damage, homeowners depend on their settlement to make critical repairs to their houses.
But when property insurance claims are denied, it means paying that costly repair bill out of pocket.
The last thing you need is a long battle with your insurer to get the money you deserve. If you’re wondering what will help your claim’s chances, read on to ensure you haven’t missed one of these common reasons why insurance claims are denied.
The Damage Is From Wear and Tear
Most home insurance policies state that the insured property should be “well maintained” and kept in “good condition.” Though your policy may not be explicit about the exact definitions of these terms, your insurer has the right to deny your claim if it looks like your property doesn’t meet these conditions.
Here are a few examples of common situations where damage would be considered “wear and tear”:
- The roof is aging and in need of repair, so the missing shingles from a recent storm may be the result of neglect and not a natural disaster
- An uninsulated pipe has burst, flooding the home with water
- An HVAC system that hasn’t been serviced on a regular basis stops working
- Untrimmed or diseased trees fall onto part of a home
With wear and tear, neglecting to take care of your home can cost you if you’re seeking compensation for damages later.
You’ve Misrepresented the Damages
It’s never a good idea to fill out your forms in a way that’s misleading. Whether you’ve withheld vital details or failed to provide accurate info, this can spell the end of your claim.
This is especially true if the damages are intentional. If your insurer’s investigations reveal that the loss or damage was actually done on purpose, they’ll reject your claim outright.
Beyond causing your insurer to lose trust in you, you may end up with thousands of dollars in fines—and even prison time for larger issues.
Insurance fraud isn’t your best bet. Make sure your claims are as accurate, detailed, and well-documented as possible.
The Damages Aren’t Covered Under Your Policy
Buying property insurance can feel complicated. With many different basic types available, each with its own intricacies, it can be hard to know where to start.
That’s without considering the specific property needs you have to take into account based on the area you live in. One common example is getting flood insurance for a flood-prone region!
As complex as these policies can be, it’s essential to understand the details of what’s covered. Most policies will cover basic perils like fire, wind, and storm damage. However, you may have to opt for additional add-ons to cover further specifics like flooding, sewage backups, or earthquakes.
Furthermore, you’ll have to understand your policy’s stances on liability and exclusions to know what’s covered in your specific situation. At the end of the day, your insurance claim will be denied if you’re seeking damages that your policy doesn’t cover.
However, if you believe your damages should be covered under your policy, you may need to get expert help. A legal team experienced in property insurance claims can work on your behalf to get what you’re owed.
You Didn’t File on Time
No matter what type of policy you have, your insurer will want you to tell them about your damages as soon as possible. In most cases, you’ll have somewhere between 180 days to a year.
Note that even if your insurance claim is legitimate, your insurer can deny it if the paperwork comes through too late. Make sure to start the claim process as soon as you can!
There’s Insufficient Documentation
When you file an insurance claim, the burden of proof is on you. The only way to get compensation is to provide evidence that the damages happened as you say in your claim.
To do this, it’s a good idea to document everything you can think of—and then some. Don’t forget, too much evidence is better than too little!
Take photo and video evidence of the damage that occurred, and keep careful notes about any losses you’ve suffered. If you already have a home inventory, this process can be easy. If not, take the time to work out an itemized list for your insurer.
You Haven’t Paid Your Premiums
This one’s an obvious reason for a denied claim, but many property owners don’t think about it until it’s too late.
Non-payment of your premiums is more than enough reason for your insurer to reject your claim outright if damage happens. Be sure to keep up with those payments!
The Damages Don’t Exceed the Deductible
It may seem like a minor issue, but some damages aren’t expensive enough to deserve an insurance claim.
If you have a deductible of $1,000, that’s the amount you’ll have to be prepared to pay out of pocket before your insurance company will provide any additional money. When a repair to your home will cost only $500, your insurance won’t pay anything on your claim.
Make the Most of Your Property Insurance Claims
Property insurance claims are time-consuming and difficult to fill out. Make the most of yours by keeping the guide above in mind.
Making an extra effort to consider every facet of the process can help you get the settlement you deserve. Keep your policy close by, and take your time working on your claim!
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