Having a place to call your own is a significant milestone in life – not only does it provide you security and comfort – but it’s also a place to create cherished memories with your loved ones.
As responsible homeowners, understanding the importance of protecting your investment from certain events is crucial. Your homeowners insurance acts as a safety net so that you can confidently face the burdens of property damage, theft, or liability claims.
But what happens when it fails to deliver on its promises? What if your insurance company denies or mishandles your claim? Can you take legal action against your own insurance company?
In this article, we’ll answer those burning questions, delve into the intriguing world of homeowners insurance and explore your rights and options when it comes to suing your insurance provider.
Understanding Homeowners Insurance Policies
Homeowners insurance is a type of property insurance that pays for losses and damages to your home if it is damaged or destroyed by fire, weather, theft, or another covered disaster.
When any of these events happen, it’s essential to determine if you have to file a claim or not. In order to do that, you should find out what your deductible is.
You must also review your insurance policy and understand its coverage and exclusions. Try to identify if there are any potential loopholes or ambiguities. If you’re confused, contact your insurance agent or the company’s hotline as soon as possible.
Before reporting the property damage, you should first assess if the damage is minor. If it is, you might decide you’re better off paying for the repairs out of pocket.
However, when the assessment reveals that it will cost more than your deductible to repair or if your property has taken a significant hit, you may then explore filing a claim.
What Should I Do Before I File A Claim?
If you decide to file a claim, you must notify your insurance company right away. You should always check the amount of time you have, as stated in your policy.
Before you meet with an adjuster, write down a list of all your affected properties. It would help if you also have photographs and videos to prove the extent of the damage.
What Is The Average Cost Of Homeowners Insurance?
The average cost of homeowners insurance is $1,582 a year for a policy with $350,000 dwelling coverage and $100,000 in liability coverage, according to Forbes Advisor’s analysis.
The average homeowners insurance cost is $2,090 a year for a homeowners policy with $500,000 dwelling coverage and $100,000 liability coverage.
What Happens If My Homeowners Insurance Claim Is Denied?
If your claim is denied by your provider, filing a lawsuit should be your last resort. You must first try to exhaust all options to resolve the dispute. Fortunately, insurance policies usually contain a clause that facilitates an internal or administrative appeal.
This is where you can challenge the denial by asking for a reassessment of the claim and an opportunity to provide additional evidence or supporting arguments that would strengthen your case.
When you initiate this process, it’s essential that you save all necessary documents, as well as a detailed record of your correspondence with the company.
Possible Outcomes Of An Appeal Against A Denied Claim
If you’re successful in your appeal, your provider will reverse its initial decision to deny your claim and pay it according to your policy. They may also offer a settlement to resolve the dispute. However, before you decide to take this route, you should first consult with an experienced homeowners insurance lawyer.
After your claim has been paid or settled, you may be barred from seeking additional compensation since you’ll lose your right to re-open the case. Thus, seeking professional legal advice would bring you peace of mind.
The Importance Of Hiring An Insurance Lawyer
According to Forbes, the top two things that cause a denial or low settlement are lack of documentary evidence and lack of an attorney.
If the insurance company figures out you are approaching them without a lawyer and proper legal advice, they may try to deny your claim or give you a very low offer based on specific legal language in your policy.
When and How to Sue Your Homeowners Insurance
Common Reasons Why Your Claim Was Denied
Here are the common reasons why an insurance company has denied your claim:
- Your policy has lapsed;
- Your coverage doesn’t include the loss;
- You did not submit the requested documents;
- There was a failure to verify the damages you suffered;
- There were errors in your application which nullified the policy;
- You failed to notify the insurance company within the required timeframe.
However, if you have a valid claim and it was improperly denied, your lawyer would then determine if you have grounds to file a lawsuit for bad faith insurance.
Filing A Bad Faith Insurance Lawsuit
Bad faith insurance refers to the tactics insurance companies employ to avoid their contractual obligations to their policyholders.
Examples of insurers acting in bad faith include misrepresentation of contract terms and language and nondisclosure of policy provisions, exclusions, and terms to avoid paying claims.
Is There a Deadline For Filing A Lawsuit Against My Insurance Company?
Generally, there is a deadline in your policy for filing a lawsuit related to your claim. You should be able to check the date in its “suit against us” provision or in a clause that has the same effect.
Usually, it’s twelve (12) months from the date of loss or the date your insurer closes your claim. Be careful to check the laws in your state to see if your situation will be eligible for an extension. It’s better to check with a lawyer to avoid losing your rights so you can get a fair payout.
For example, the statute of limitations in West Virginia is ten (10) years for a bad faith claim based on a contract theory (W. Va. Code § 55-2-6).
On the other hand, it’s one (1) year for a bad faith claim based on a common law theory or a statutory theory under the West Virginia Unfair Trade Practices Act.
Hiring An Attorney For Insurance Litigation
Your home is more than just a physical structure; it’s a sanctuary. Unfortunately, life is unpredictable, and we cannot always prevent accidents or natural disasters, so your homeowners insurance acts as your protection.
This is why unfair or unreasonable denial of your claim can be incredibly frustrating, and hiring legal representation becomes crucial. You need an attorney who can recognize the urgency of your situation and would act swiftly in your best interests.
Hire Desai Law
At Desai Law, we pride ourselves on being a formidable legal team that knows the ins and outs of the insurance industry. We can help you maneuver against any unjust tactics from your insurance company.
We know how hard you’ve worked to pay off the premiums, so we won’t rest until we’re able to get what you’re entitled to – we won’t abandon you in your time of need.
If you’re ready to pursue a case with us, call (304) 974-1974 now for a free consultation.