8 Signs Your Insurer Underpaid Your Home Insurance Claim – And How to Fight Back

Did your insurer underpay your claim? Should you hire a public adjuster or insurance attorney to fight back? How do you fight back when your insurer wants to underpay your claim?
Keep reading to discover some of the signs your insurer underpaid your home insurance claim.

1) Denied or Partially Denied Claims

Many homeowners think it’s the end of the claim when an insurer denies or partially denies your claim.

In some cases, insurers will deny a portion of your claim. They might claim a portion of water damage occurred because of flooding (which isn’t covered by insurance) instead of rainstorm damage (which is covered by insurance).

Insurers have the right to deny your claim for certain reasons. However, many insurers deny your claim because they’re trying to underpay the claim.

Let’s say your insurance company spots a sign the damage occurred because of an uncovered cause – like flooding or pre-existing damage. They might put that cause into the report without investigating further, reducing your claim by thousands of dollars.

How to Fight Back: Don’t accept a denied claim at face value. Investigate the denial and the reasons behind it. Challenge your insurer for proof. Or, hire a public adjuster to do the hard work for you.

2) Suspiciously Low Estimates

If a local roofing contractor claims it will cost $15,000 to replace your roof, but your insurance company is only offering $6,500, then there could be an underpayment issue with your claim.

Many homeowners are disappointed by their insurer’s offer. Unfortunately, that’s an ordinary part of home insurance. In most cases, the damages seem great to you, but small to your insurance company.

However, some insurers take this too far by deliberately underpaying your claim. They might underestimate the cost of repairing the damage, for example. Or, they are making a low initial offer in the hopes that you accept.

Check your insurer’s offer thoroughly to ensure the estimates make sense. If one or more estimates seem unusually low, then challenge your insurer.

How to Fight Back: Get two or three estimates from local contractors in your area. Provide these estimates to your insurer. Provide receipts, links to comparable items online, and other documentation to justify the value of items in your home.

3) Missed Damage

Did the insurance company’s adjuster rush through the property inspection? Did they seem like they were in a hurry to get out?

It’s easy to miss damage during a home insurance claim – especially for complex claims with extensive damage in multiple parts of the property.

Some insurers accidentally miss damage during the initial inspection.

In other cases, insurers may deliberately avoid looking in places where they know there could be damage – like the attic after a windstorm, the basement after a heavy rainstorm, or your HVAC system after a kitchen fire.

All of these damages could add thousands of dollars to your claim. Your insurer wants to pay as little for your claim as possible, so they could miss damage –accidentally, due to a lack of training or because they are in a hurry to get to their next claim.

How to Fight Back: Check your entire property for any signs of damage after a covered event – even in places you might not think. Soot can spread throughout your home after a small fire, for example, and water can leak from your roof through your entire home.

4) Poor Communication from the Insurance Company

Good insurers are transparent. They keep you in the loop at every step of the claim. They ask for reasonable proof of damage, then pay a fair amount for your claim.

Unfortunately, not all insurers are transparent. Some insurers deliberately ignore your calls and emails, evade your questions, and hide what’s going on behind the scenes.

• Do you ask your insurer questions and they avoid responding?
• Does your insurer take a long time to respond to you?
• Does your insurer ask too many questions – or too few questions?
• Is your insurance company easy to contact?
• Has your insurer updated you on every step of the claim process? Or are you unsure what step of the claim you’re on?

Poor communication could be an early warning sign for an underpaid claim.

How to Fight Back: By law, insurers must respond to your communication within a reasonable length of time (and you must respond to your insurer in a reasonable length of time). Look up your state’s insurance laws regarding communication and claims handling. Repeatedly contact your insurer and hold your insurer accountable to these timeframes. Or, hire a public adjuster to fight on your behalf.

5) Excessive Demands for Evidence

All insurers require evidence – like photos, videos, and damaged items – to pay your claim. It’s a normal part of doing business.

However, some insurers demand excessive evidence, and it could be a sign they’re underpaying your claim.

If your insurer is repeatedly demanding evidence from you without an apparent reason, it’s a sign they could be preparing to underpay your claim.

Insurers could be checking your evidence for a reason to deny your claim – like signs of pre-existing damage or proof you failed to properly maintain your home.

How to Fight Back: You’re obligated to provide evidence to your insurer upon request. However, insurers also have an obligation to negotiate in good faith and process your claim in a reasonable length of time. When insurers drag their feet or demand excessive evidence, it may be time to hire a public adjuster or insurance attorney.

6) Asking for a Recorded Statement

If an insurer asks for a recorded statement from you, it’s a sign there could be something wrong with your claim.

In many cases, insurers use recorded statements to trip up homeowners or find a reason to deny your claim. Because your statement is recorded, it’s a justifiable reason to deny your claim – even if your claim is completely legitimate.

Insurers could use fine print and loopholes within your contract, for example, to deny your claim. They could ask questions about pre-existing damage to your property that could deny your claim.

How to Fight Back: Avoid giving a recorded statement to your insurance company. Or, have a lawyer or public adjuster with you before giving a recorded statement. Even if your claim is completely legitimate, your responses could be used to deny your claim.

7) The Claim is Moving Too Fast – or Too Slow

If your claim is moving too fast, it could be a sign your insurer is rushing through your claim and hoping you accept the first settlement amount. Then, the insurer can close the claim and move on.

Similarly, if the claim is moving too fast, the insurer could be dragging it out in the hopes that you accept whatever their first settlement offer is.

How to Fight Back: Most insurers complete claims within 30 to 60 days. If your insurance claim is moving too fast or taking too long, it could be a sign something is wrong with your claim.

8) They Tell You Not to Contact a Public Adjuster or Attorney

Some insurers warn policyholders not to hire a public adjuster or an attorney because it would violate the terms of your insurance contract.

We have recently seen some insurers trying to add in a Public Adjuster clause where the insured receives a lower rate for agreeing not to hire a Public Adjuster. However in most cases this threat is not realistic. You should be allowed to hire a public adjuster or attorney without impacting your insurance contract.

If the insurer is warning you against hiring a public adjuster or attorney, it’s a sign they’re nervous about the legality of their actions. Typically, only insurers acting deliberately in bad faith will warn against hiring a public adjuster or attorney.

How to Fight Back: Hire a public adjuster or attorney if the disputed amount is over $10,000. Or, schedule a free consultation with a public adjuster or attorney any time your insurer tells you not to do so.

Fight Back by Hiring a Public Adjuster

ClaimsMate public adjusters fight back against greedy insurance companies.

They know the tricks insurers use to underpay claims – and they know how to push back.

By hiring a public adjuster, you could get the exact amount of money for your claim that you deserve.

Contact ClaimsMate today to schedule a free consultation with a public adjuster.

Stephanie Corona

Stephanie is a property insurance claim expert with over 20 years of experience working as an insurance adjuster, expert witness, appraiser and umpire. She is passionate about sharing her expertise, knowledge, tips and training to help both property owners and Public Adjusters in their pursuit of effectively managing claims and recovering the claim settlement they deserve after a loss.