Filing an insurance claim can be much more complicated than it first appears. To some who have never filed a claim before, there is the assumption that all they must do is notify their insurance carrier of their loss and wait to be paid. They are unaware that the burden to prove that covered property has been damaged or lost due to a covered peril rests entirely upon them. Many mistakenly believe that they are entitled to be paid unless the insurance carrier can prove otherwise, which usually results in frustration and misunderstanding.
Before deciding to file an insurance claim, a policyholder should understand two important points:
1. It is always the burden of the policyholder to prove that a covered peril caused damage to their covered property.
2. It is always the burden of the insurance provider to prove that an excluded peril caused the loss.
Often (actually, too often) a policyholder will note a symptom of damage – such as a leak in the ceiling – and file an insurance claim for damage to their roof. Without knowing the cause of the leak or whether that cause was due to a peril covered under their policy, they will ask their insurance carrier to send out an adjuster to pay their claim.
The insurance company’s adjuster, whose duty is to protect the interests of the insurance company he works for, does NOT have the duty to prove that a covered peril caused the loss. Instead, he is there to collect information and evidence to support (if necessary) his burden to prove that an excluded peril caused the loss if, indeed, it did. When he is uncertain about his observations and the possibility of an exclusion under the policy to apply to the loss, he may seek the assistance of a third party (such as an engineer, architect, or consultant) to assist him.
After his investigation, unlike the typical policyholder who has not prepared his case to prove that a covered peril caused damage to their covered property, the insurance carrier is fully prepared to argue against coverage with any proof that an excluded peril caused the loss that the adjuster may have found.
Thus – knowing that they must first prove that their covered property was damaged by a covered peril – the prudent policyholder will investigate their own claim BEFORE inviting the carrier to begin their investigation of it. This is what I usually recommend:
1. Know, as best as you can, exactly what is damaged and what caused it. If you are unable to determine this on your own, seek the advice of a trusted professional skilled in the material(s) that is damaged. If your roof is leaking, for example, have a roofer find the source of the leak and the cause of that source.
2. Collect physical and/or photographic evidence of the damage and proof of its origin. Obtain a bid from a trusted contractor for the cost to restore the damage to its condition prior to the loss. (Avoid allowing your contractor to negotiate directly with the carrier. A contractor’s lack of knowledge of your coverage and his interest in profiting from the work provides the adjuster with ease in exploiting and manipulating him.)
3. Learn if that damage is covered under your policy. Read your policy, speak to your agent, or consult with your attorney or public adjuster for assistance if you are confused about your policy’s language. Sometimes, it’s tricky.
4. Provide copies of your evidence to the insurance company when you file the claim or, if more convenient when the adjuster visits to inspect the property. (If you are not confident or comfortable in doing this, hire a public adjuster to represent you with this process.)
5. If your insurance carrier does not cooperate with you after providing proof of your loss and coverage, seek the assistance of an attorney or a public adjuster.
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