One of the most complicated sources of insurance disputes involves homeowner’s insurance. No one ever wants a disaster or misfortune to damage their home. When it does, it can be a difficult time for homeowners, especially if a mortgage is involved. It is an industry standard for a mortgage company to require a homeowner to have insurance for the duration of the mortgage. No one ever wishes to experience hardship in their home, and homeowner’s insurance is meant to provide peace of mind to homeowners in case the unthinkable happens. Unfortunately, sometimes a homeowner may run into difficulty when dealing with their insurance company.
Homeowner’s insurance is meant to cover a homeowner’s property, both inside and outside of the home. This is significantly different from renter’s insurance, as a homeowner’s policy will often insure the replacement cost of not only the contents of the home but the entire structure of the house itself. Most of the time, a mortgage company will require a homeowner to, at the very least, cover the structure of the actual home itself.
COMMON SOURCES OF CLAIMS
There are a number of reasons for a person to contact their insurance agency for a homeowners claim. Claims on homeowners insurance can stem from some of the following circumstances:
- Natural Disaster: Things such as hurricanes, tornadoes, floods, and other sources of natural disaster can be a common reason to file a claim with an insurance company. These disasters often destroy both the contents of the home, as well as much of the home itself.
- Accidents: While it is seldom thought of, accidents can also be a source of damage to a person’s home. An example of this would be an impaired drivers who can’t keep his or her car on the road and slams into a person’s house.
- Fire: A house fire is a tragedy that can happen to any family. These are common sources of homeowners insurance claims and can be quite large, as a house fire can destroy most of the property, as well as the contents.
- Burglary: When a person’s home is broken into, their loss can sometimes be covered by homeowner’s insurance. Many of these claims require proof of purchase or ownership in order to grant full coverage of these items.
- Vandalism: Similar to burglary, many times a person’s home may fall victim to vandalism. Damage to property can be a costly claim, especially for replacement or repair of damaged portions of a house.
Many times, a person’s homeowner insurance policy will be set up to cover specific amounts and types of incidents. At times, however, an insurance company may deny a claim submitted by a homeowner.
REASONS FOR DISPUTING A HOMEOWNER’S INSURANCE CLAIM
Sometimes, a claim may cause a dispute between the insured person and the insurance company. These disputes can occur from a variety of circumstances. Some common reasons to dispute a claim can include:
- Coverage Disputes: Many times, insurance companies may take issue with what can be covered fully or covered at all under an insurance dispute.
- Gap in Coverage: Claims may also fall into dispute if the incident that led to the loss arose during a time period where a gap in coverage was present. This can occur when a person is negotiating new insurance coverage.
- Negotiation of Settlements: When a person is involved in a claim, they may wish to engage in negotiations to reach a settlement with their homeowner’s insurance company. Most often, a person may feel entitled to more coverage and can take this up in negotiations with their insurance company.
- “Bad Faith” Insurance: The law requires an insurance company to owe a duty of good faith and fair dealing with all their insured individuals. This basically means that insurance companies owe a certain duty to their policyholders to investigate and properly pay out for all claims that are covered. Refusing to pay on a claim for property or loss that is covered by a policy may be considered acting in “bad faith,” which may lead to an insurance dispute.
Disputing A Homeowner’s Insurance Claim
Most claims can be settled easily; however, when a person wishes to dispute a homeowner’s insurance claim, it may be helpful to contact an attorney. When negotiating settlements with an insurance company, a claims agent will typically try to settle the claim as quickly as possible. While this may be helpful, as a person can be quickly compensated for the loss, it may not always be the full amount a person is entitled to per their agreement. Contacting an attorney at this time can help the insured person understand the claim, the policy language, and any other things that may be affecting what a person can receive for their claim. An attorney can give a person a proper edge for negotiating their claim with an insurance company.
Will My Case Go To Court?
While many claims can be settled outside of court, if the insurance company refuses to offer an acceptable settlement, or if the company has acted in bad faith to the policyholder, the matter may become more serious. An attorney can bring the case to court for resolution by judge and jury. Not all insurance disputes go to court; however, the more grave the offense, the more likely the case is to escalate to a higher level than negotiation.