Understanding the Homeowners Insurance Claims Process

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Experiencing a property damage loss is a stressful situation for any homeowner.  Understandably, you will want to do everything you can to get your home and life “back to normal” as quickly as possible, and you expect your insurance carrier to promptly and properly adjust your claim and issue payment so that repairs can commence.  But what exactly are the insurance company’s obligations with respect to timely claim adjustment?  It is important for you to understand the statutory time limitations the State of Florida imposes upon insurance carriers so that you can be sure your carrier is adhering to its duties.

Acknowledgement of Communication

The insurance company must review and acknowledge receipt of a communication with respect to an insurance claim within 14 calendar days from receipt of such communication, unless payment is made within that period of time or the failure to acknowledge is caused by factors beyond the control of the insurer which reasonably prevent such acknowledgment.[1]  In other words, you should expect an acknowledgement by the insurance company within two weeks of first communicating to it about your claim.  The insurance company’s acknowledgement must be responsive to your communication – if you submitted a new claim, the insurance company must respond by either reasonably advising that the claim appears not to be covered by the insurer, or by providing the necessary claim forms and instructions you will need to submit the claim, including an appropriate telephone number where you can reach a claim adjuster.[2]

Claim Adjustment and Investigation

Shortly after submission of the claim and acknowledgment of receipt by the insurance company, the insurance company may require you to submit a document called a Proof of Loss, which is the policyholder’s statement of the amount of money being requested, signed to and sworn to by the policyholder with documentation to support the amount requested.  Within 10 working days after an insurer receives a Proof of Loss statement, the insurer must begin its investigation and adjustment of your claim unless the failure to begin such investigation is caused by factors beyond the control of the insurer which reasonably prevent the commencement of such investigation.[3]  The investigation likely will include taking statements of the homeowners (which are often recorded, and occasionally taken under oath), inspections of the property and collection of any additional evidence you may have to bolster your claim (such as receipts for temporary repairs, photographs of the property, damaged items, and estimates or proposals for repairs).

From the moment you first contact your insurance company to submit a claim, everything you say and do with respect to your claim will be noted and scrutinized by the insurance company in its claim adjustment.

Claim Determination

The insurance company must make a claim determination within 90 days after an it receives notice of an initial, reopened, or supplemental property insurance claim, unless the failure to pay is caused by factors beyond the control of the insurer which reasonably prevents such payment. [4]  That means that the insurance company must make a decision – one way or the other – with respect to coverage for your claim, and must either pay or deny the claim within about three months’ time from the date you first provide notice of the claim.  If the insurance company delays in making payment on an initial or supplemental claim for more than 90 days following the time the company receives notice of the claim, or 15 days after there are no longer factors beyond the control of the insurer which reasonably prevented such payment, then you are entitled to collect interest on the payment amount, which begins accruing from the date you first provided the insurer notice of your claim.[5]  This penalty incentivizes the insurance company to timely resolve its policyholders’ claims.  Unfortunately, there are many instances in which an insurance company fails to abide by its statutory requirements to timely adjust claims.  An unreasonable delay in investigating, adjusting, and paying for an insured’s loss can constitute insurance bad faith.

From the moment you first contact your insurance company to submit a claim, everything you say and do with respect to your claim will be noted and scrutinized by the insurance company in its claim adjustment.  It is in the insurance company’s interest to pay out as little as possible or to find a reason to deny coverage for your claim.  That is why we strongly recommend retaining assistance of an experienced attorney to assist in every aspect of your insurance claim to ensure the insurance company properly handles your claim from the outset.  If you believe your insurance company has not acted in good faith, an aggressive and knowledgeable property insurance attorney can protect your interests and make sure you get the coverage you deserve.

Sources:

[1] Fla. Stat. § 627.70131(1)(a)

[2] Fla. Stat. § 627.70131(2)

[3] Fla. Stat. § 627.70131(3)

[4] Fla. Stat. § 627.70131(5)(a)

[5] See [4]