Purchasing a home is a difficult process, particularly for first-time buyers. Purchasing a home, on the other hand, is a watershed point in many people’s lives, and home is frequently a family’s most important possession. As a result, it’s critical to ensure that it’s covered by the appropriate insurance. Some homes, on the other hand, maybe more difficult to insure than others. A mortgage company is unlikely to approve your loan if you are rejected homeowner’s insurance. Obtaining homeowners insurance can be challenging for a variety of reasons, ranging from the location of the home to who lives in it and what it is used for. Furthermore, situations like flooding, wildfires, construction and renters can all affect your ability to accept homeowners. Even the hardest of us can be broken by dealing with the aftermath of a calamity. Even worse, you may discover that your insurance claim has been refused, leaving you with nothing. Making a claim on your homeowner’s insurance is usually a simple process. However, while the majority of claims are allowed, a few are rejected from time to time.
In the event of a disaster, it’s important to know that your home is insured. However, what if you’re denied coverage? This can be an unsettling scenario for any homeowner. There are several reasons why an insurance company may deny a home insurance claim.
What Is An Insurance Claim?
A policyholder’s formal request to an insurance company for coverage or compensation for a covered loss or policy event is known as an insurance claim. The claim is verified by the insurance company (or denies the claim). If the claim is allowed, the insurance company will pay the insured or an authorized interested party on the insured’s behalf.
From death benefits on life insurance policies to routine and comprehensive medical tests, insurance claims cover it all. A third party may be permitted to file claims on behalf of the insured individual in particular instances. However, in the vast majority of cases, only the policyholder(s) is/are eligible to receive payments.
Reasons Why Your Home Insurance Claim Can be Denied
There are many reasons why your home insurance claim can be denied:
Lack of Coverage
There are various exclusions in a homeowner’s insurance policy. Exclusions are a term used to indicate things that are not covered by a policy and are frequently found deep inside an insurance contract. The firm may argue that the damage you sustained was caused by anything outside the scope of coverage and thus deny policy benefits. An attorney can assist you in navigating a complex insurance contract to determine whether your claim is covered. Exclusions are included in every property insurance policy. You might expect your claim to be denied if the cause of your property damage is not covered by your policy. Although home insurance can protect you against a variety of threats, it does not cover every form of loss. Standard homeowners’ insurance normally covers damages caused by fire, lightning, and wind, but the policy has a number of limitations. Flood and earthquake insurance must be purchased separately, and mold and water backup losses are not covered unless you pay an additional price to include them in your policy. If the cause of the damage is not listed among the covered events in your insurance, you might anticipate your claim to be refused.
Filing After the Deadline
Home insurance claims must be filed and documented within a certain amount of time. If you miss the filing window, which is usually 180 days to a year depending on your policy, your claim will be denied, regardless of how valid it is.
If your home is damaged by a covered risk, tell your insurance carrier as soon as possible and begin the claims procedure to prevent having your claim denied because you failed to file on time. After an incident causes you harm, you must typically make a claim with your insurance carrier as soon as possible. Though filing your claim in a timely manner may appear to be a minor clerical concern, the insurance company may deny your claim if it believes you waited too long. The time limit for filing a claim is usually stated in an insurance contract; however, it may be buried in the policy. An attorney can assist you in navigating the boilerplate terms of an insurance policy in order to determine the particular time constraints for submitting a claim.
Your insurance policy will require you to notify them of any loss as soon as possible. Any claim must also be filed and documented within a certain amount of time.
Premiums that Have Not Been Paid
It’s much riskier than you think to skip payments on your house insurance or pay your premiums late. Your coverage may lapse if you do not pay your premiums. Your insurance company may be able to deny your claim if this occurs and your home is damaged.
Keep up with your house insurance payments to avoid being without coverage when you most need it. Having a history of missed or late payments can also harm your credit rating, resulting in higher premiums in the future. It’s extremely vital to keep up with your premium payments. You will be required to pay your premium on time by your insurance company.
Non-Disclosure of Information
When it comes to making a home insurance claim, lying about the nature and degree of the damage is possibly the worst error you can make. The insurance company will send their own adjusters to your home after a tragedy to inspect the damage. If they discover that you were not completely honest or provided false information on your claims form, your claim is likely to be denied.
Never give false information or try to conceal previous claims in order to keep your no-claims discount. Because your insurer will find out the truth and get to the bottom of things, either way, be as precise and exact as possible. Post-disaster your insurance company is likely to send their own adjuster to look into your claim. It’s possible that your claim will be refused if they uncover anything odd or doubtful in the original application for coverage or the claim itself. The insurance company will usually dispatch an investigator to the scene. This investigator will gather evidence and statements, inspect your property, and interview witnesses to the events that led to your claim. The insurer may deny your claim if the investigator determines that the information on your claim contradicts the investigator’s conclusions.
Damage Documentation Is Insufficient
It is your obligation as a property owner to substantiate the veracity of your claim to the insurance company, not the insurance companies. To pay your claim, insurance adjusters will need as much information as possible. To aid in establishing your case, make sure you document the disaster’s damage or aftermath in great detail.
Your insurance company may deny your claim if you don’t give adequate documentation (papers, photos, videos, etc.) or satisfy the adjusters. As a property owner, one of your responsibilities is to file and prove your claim with the insurance company; it is not the insurance company’s responsibility to prove the claim to themselves. As a result, it’s critical that you document the damage to your property in detail by taking photographs in the aftermath to present as evidence in your case.
Failure to Take Reasonable Care
Homes are built to last a long period, yet the passage of time can wear them down. Things will start to appear bad if they are not properly cared for.
Almost all homeowner’s insurance policies require that the property be well-kept and kept in good repair. If the insurer determines that the damage was caused by normal wear and tear or that the incident that initiated the claim was caused by your negligence, your claim is likely to be denied.
Inability to Mitigate
It is your responsibility to take reasonable precautions to avoid damage to your house and to act quickly after an occurrence to prevent further harm. This is referred to as mitigation. Insurance companies expect their customers to mitigate damage, and if it looks like you did not do enough to prevent the damage from escalating, your insurer may refuse your claim.
After a property loss, the policyholder is responsible for protecting the property from additional damage and minimizing the loss. Leaving the property vulnerable to further loss and failing to take reasonable steps to mitigate the loss could result in a denial.
Ways to Avoid Denial of Your Home Insurance claim
There are many ways you can adopt if you do not want to have a problem while claiming for home insurance claims in cases of disasters:
· Notify your insurer as soon as possible if you have suffered a loss, and be aware of the time constraints for submitting a claim.
· Make sure you pay your premiums on schedule.
· Know what your policy covers and excludes, and if available, get enough coverage.
· After a loss, take all possible precautions to protect the property and reduce the damage.
· Make a careful list of all damage and file a detailed itemized claim with your insurance company.
For individuals who are unfamiliar with the ins and outs of a property claim, it can be time-consuming and challenging. Hiring a professional, such as a public adjuster, to assist you with filing a claim, documenting losses, and negotiating with your insurance carrier might be crucial to your settlement
For individuals who are unfamiliar with the process, filing a home insurance claim can be difficult and time-consuming, especially when there is more at stake or a higher chance of a disagreement.
If an insurance company declines your claim, they are unlikely to change their minds until you provide additional evidence to support your case. This is why, before filing a claim, it is strongly advised to consult with an experienced insurance claim attorney. In addition, when a lawyer is involved, insurers are less likely to deny a genuine claim.
Even if your claim has already been denied, an attorney can still assist you with the investigation. You don’t have to go up against the insurance company by yourself. Examine the situation from all angles to see if you can persuade your insurance company to change its mind.