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Fire & Water - Cleanup & Restoration

The Top 5 Reasons Why Insurance Companies Deny Your Claim for Storm Damage

11/30/2021 (Permalink)

As a homeowner, you assume that your home is covered by insurance against a variety of threats and losses. Whether it's the threat of fire, water damage from a busted pipe or even theft, you hope insurance will be there for you when disaster strikes. But what happens if your insurer refuses to pay for damages because of an exclusion in the policy? Just because you don't have clear title to your property doesn't mean it can't be insured. In many cases, insurers will cover these types of conditions as long as the buyers have been made aware before closing on the house.

When you’re foreclosed on and Still Owe Money to the Lender

If you're foreclosed on and still owe money to a lender who holds a lien on your property, most policies won't cover damage to the structure. Before you buy a foreclosed house, get advice from your insurance agent about what types of coverage are available for you before buying it.

There can be several reasons for why insurance companies may deny your claim. Here are the top five reasons why an insurer may deny your claim for damages caused by a storm or other casualty:

  1. You didn't have sufficient homeowners' insurance coverage in place at the time of loss.
  2. You don't have clear title to your property can be another reason for why your insurance company may deny your claim.
  3. You didn't follow the proper procedure for reporting a loss, such as notifying your agent or insurer immediately after a storm hits.
  4. The damage occurred due to neglect on your part, such as failure to cut down a tree that threatens your house's structural integrity.
  5. The damage was caused by an excluded peril, such as faulty repair work done on your home following a prior loss.

As frustrating as it can be insurers refuse to pay for damages, it's important to remember that their denial doesn't mean the damage didn't occur. It simply means that you couldn't prove, with your policy in place, that they were obligated to cover the loss. This is why it is very important to take photographs of your house when you know that there is a storm coming

When You Can Sue Your Insurance Company for Denial of Coverage

If your insurance company denies coverage for storm damage or any other kind of disaster, you may have recourse through state law. Check with a local attorney about whether you can file a claim based on breach of contract if the insurer refuses to pay out on your homeowners' insurance policy. Also contact your state department of insurance for more information about what remedies are available under the law if an insurer denies your claim.  

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