Ten Tips: How To Make Your Claim Easy to Pay

Follow these ten tips to get your property/home damage claim paid faster and in full. Your insurance carrier receives hundreds of claims, many of which are similar to yours. As the claims come in, the insurance company triages each claim and categorizes them as easy to pay, deny, investigate, or litigate. Most companies would challenge this characterization of their triage process as overly simplistic. Insurance carriers handle each claim individually based on the policy language, the facts of the loss and the law that applies. Regardless, your job is to get your claim into the “easy to pay” category as soon as possible. You cannot eliminate the need for the company to investigate or adjust the claim, but by following these ten tips, your claim will be paid fully in the shortest time possible.

1) Review your policy
Make sure you have a copy of your policy including the declaration page before your loss occurs. Confirm that the policy was in force on the date of loss. The coverage period is clearly listed on the declaration page. The “dec” page also includes a summary of your coverage, types of coverage and the deductible. Determine if your policy is a typical “all risk” policy or the more limited, “named peril” policy. If it is a named peril policy, review the perils covered to make sure your loss was caused by a named peril. Named perils generally include wind, hail, fire, smoke, lightning, theft, vandalism, and others. If your personal property was damaged, many policies, even an “all risk” policy, provide coverage for contents on a named peril basis. Make sure you know the specifically named peril that caused the damage to your personal property. Determine whether your policy provides replacement cost coverage or actual cash value, which is less. Again, damage to the structure and damage to personal property/contents require a different analysis. Finally, review the exclusions. Even if your loss appears to be covered, it may be subject to a specific exclusion. Knowing what is covered and what is excluded, before you report your claim, helps you present your claim in a way that avoids exclusions and makes it easier for your insurance carrier to allow coverage and pay the claim.

2) Identify the cause of loss
Once you understand what is covered, not covered, and excluded, you are ready to tell clearly your insurance company the cause of loss and to avoid unnecessary discussions about possible exclusion. For example, many policies require an opening in the roof, windows or walls caused by a covered cause of loss before it will consider payment for interior damage caused by wind or hail. If you are reporting a hail damage claim to your roof with interior water damage caused by the now leaking roof, make sure you can describe how and where the hail created an opening in the roof that allowed water to leak in and damage the interior.


No Breach of Contract Action Necessary for Bad Faith

Can an insurer be liable for bad faith under §625.155 F.S. after appraisal when there is no underlying breach of contract lawsuit? The 4th DCA, in Cammarata v State Farm allowed the insured to proceed with a bad faith suit although the insured never filed a breach of contract suit. The 4th DCA ruled that resolution of a breach of contract suit in favor of the insured is only one of several alternative prerequisites necessary to perfect a statutory cause of action for bad faith. The opinion determined that an appraisal award in an amount more than offered by the insured, was tantamount to a favorable resolution necessary to proceed with a bad faith action. 

The Cammaratas suffered damaged to their home from the 2005 storm, Hurricane Wilma. State Farm estimated the damage as below the policy deductible. The Cammaratas demanded appraisal. Both parties petitioned the court to appoint a neutral umpire. The umpire issued an award in an amount above the State Farm deducible, but less than the Cammarata’s estimate. State Farm paid the award and the court dismissed the underlying petition to appoint an umpire. The Camaratas then sued State Farm for bad faith.  A breach of contract suit was never filed.


How to choose the right mediator

No matter the reason for going to mediation; it’s important to have a mediator who is right for your case.  Often, the judge will require mediation before allowing a case to proceed to trial. Sometimes the parties will attempt an early mediation in an effort to avoid significant litigation expense.  Occasionally, parties may wish to mediate for reason other than attempting to resolve the case.

For instance, the parties may wish to mediate to learn more about the strength and weakness of the other side’s case. One party may wish to mediate in order to demonstrate how strong their case is. Or a party may wish to mediate to determine if a settlement is possible in the future, even if not immediately available during the first mediation conference.

Whether you wish to mediate to capture a settlement or to explore the case in more detail, you should be sure and pick a mediator who is right for the case.