Once there was a maintenance man who worked in a famous art museum and was directed by his supervisor to touch up the white paint on the wall of a certain gallery within the museum.  As he was ascending his ladder he accidentally tipped over his gallon of white paint and it splashed across the surface of a 550-year-old painting from a world-famous artist that hung in the gallery.

Of course, the painting was insured and the curator immediately filed a claim.  The insurance adjuster took a few photos and shared them with his boss who said “We need to send out an engineer.”  

The engineer arrived to examine the painting and noted that the framed canvas was designed and intended to hold paint of various colors.  Since the canvas and frame were still intact, he recorded that the painting was still “functional”.  The painted surface had white paint splashed across the smiling face of a woman named “Lisa” or something, but he reported the damage was “cosmetic” in that it did not interfere with the “function” of the canvas to hold paint.  It was, after all, covered with paint … and the gallery was filled with various paintings with random splashes and colors.  He concluded that there was no “functional” damage and the insurance company denied the claim.

This story is fictional, of course … but the actions described represent those that are quite common with home and business property insurance claims.

Let’s look at the shingles on your roof, for example.  The manufacturer of your shingles produces them in a wide variety of colors, shapes, and styles.  When you selected them (or selected the house that already had them), you noted their color and design in context with the features of the rest of the structure, didn’t you?  Of course, their designed purpose is to protect the roof from wear and water intrusion but they also were carefully and creatively designed to enhance the beauty of the home.

When a sudden storm pounds them with hail, along with the metal appurtenances, gutters, downspouts, and other surrounding materials, they will often be damaged.  When they are damaged, you might contact your insurance carrier to file a claim for direct physical damage or loss to your roofing materials.  The insurance adjuster will arrive, take a few photographs, and return to speak to his boss.  When the boss does not want to pay you for your damage … he will send an engineer.

The engineer will often look at your shingles and surrounding metals for gaping holes.  Finding none, he declares that the shingles and metals are still shedding water as they were designed to do, and the damage to them is not “functional” but merely “cosmetic”.  Based on this report, the manager will deny the claim – for this is the very reason the engineer was hired.

Denying the claim because of an engineer’s definitions of damage rather than the insurance policy’s definitions of damage, however, can be improper.  Some insurance companies have been successfully sued for such actions, as in the case of North-Shore Co-Owner’s Association versus Nationwide Mutual Insurance Company.

When you believe that your insurance carrier is trying harder to deny your claim than pay your claim, you may be the victim of improper claim handling, bad faith, or vexatious actions on the part of your carrier.  When this happens, seek the advice of your attorney or a licensed public adjuster.