Property insurance is supposed to protect you from the financial consequences of accidents and natural disasters. When you file a claim, it’s reasonable to expect your insurer to cover the expenses in your policy so you can move on with your life without suffering financially. Unfortunately, that’s not always what happens.
In a perfect world, every insurance company would honor covered claims immediately and in full. The problem is that in the real world, insurers are motivated to pay as little as possible on every incident. In some cases, this leads to insurance companies underpaying claims that should have been fully covered.
You have options if you believe your insurance provider has underpaid your claim. Here’s what you need to know about determining if your claim has been underpaid and your options for receiving full compensation.
How to Tell If Your Insurance Underpaid Your Claim
There are two reasons why an insurer may underpay your property damage claim: honest mistakes and bad faith. The two situations may look very different.
Your insurer may underpay you by accident if you aren’t thorough when you file. Home insurers require detailed, accurate reports to pay the full covered amount. If their settlement offer appears to be ignorant of parts of your situation, you or they may have made a mistake.
You can minimize the risk of your insurance accidentally underpaying a claim by:
- Documenting the initial incident carefully: Make sure you take pictures and video of the damage and write down details like when it happened and how much immediate repairs cost.
- Providing a complete property inventory: If your policy covers personal property or merchandise, it’s essential to keep a comprehensive list with pictures of the items that you want to be covered by the insurer.
- Filing your claim quickly: If you delay your report, critical evidence of the damage may be lost. File your property damage claim as soon as possible to ensure the insurance adjustor doesn’t miss evidence lost to time.
You can prepare for future property damage claims by joining the Professional Law Group’s Ready Now program. By registering with Ready Now, you’ll ensure that any future insurance claims will be complete, accurate, and timely.
Bad faith situations are different. If your insurer underpays your claim in bad faith, they actively violate good business practices and the law. Your insurer may be acting in bad faith if:
- They misrepresent an element of your policy or a material fact to you
- They refuse to make a reasonable settlement attempt when you have filed an accurate and complete claim
- They fail to explain to you the reason why they are denying or failing to pay your claim in full
- They request unreasonable documentation for your claim, including documents not listed in your policy
In all these situations, the insurer is preventing or making it unnecessarily difficult for you to receive just compensation for your property damage. You may need to take legal action to receive the compensation you’re owed.
How to Pursue Full Compensation for Your Claim
Whether your insurer underpays your claim on accident or on purpose, you have options. In fact, you may be able to pursue full payment for up to five years after the incident, even if the claim has been closed. You can reopen a case due to underpayment or because you discovered additional damage.
If you want to pursue total compensation for underpaid claims, here’s what you need to do.
Understand Your Insurance Policy
The most important requirement for a successful insurance claim is understanding what your policy covers. Many types of home and commercial property insurance are available, and there are critical differences in what and how much they cover. For instance, many policies actively exclude flood coverage unless you get an additional rider.
The best way to understand your policy is to consult an expert insurance attorney. The Professional Law Group offers free consultations, so you can learn what your policy should cover and whether your insurer has fulfilled their contractual obligation to you.
Don’t Accept the Insurance Company’s First Offer
If your insurer offers a settlement that’s obviously too low, you don’t need to accept it. You have the right to dispute the offer and request the compensation that’s been denied. For instance, if your insurer has failed to address a specific element of your claim, you can ask that they explain why they have not covered it. If they cannot provide a reason, then you may have grounds to take legal action.
Consult an Experienced Insurance Attorney
If your insurer does not change their offer, it’s time to get legal help. You can reach out to attorneys with experience as professional adjusters to get a second opinion on your situation.
When you get legal assistance, you accomplish two things. First, you demonstrate to the insurer that you are serious about pursuing the funds you’re due, which may motivate them to take a better look at your case. Second, you ensure that if you need to take legal action, you already have a team of experts on your side who have a thorough understanding of the situation. As a result, you’re more likely to receive the funds you need from your dispute.
Receive Just Compensation for Your Property Insurance Claims
Your insurance provider is legally obligated to cover everything listed in your policy. If you think your insurer has underpaid a property insurance claim, you have up to five years to reopen that case and pursue just compensation for the damage you faced. At the Professional Law Group, we specialize in helping people like you fight for fair home and commercial property insurance settlements. We have experience as adjusters, so we can use our knowledge to help you document the damage and work with your insurer on equal footing. Reach out today to learn how we can help you pursue full payment for your property insurance claim today.