Insurance Companies Are Increasingly Denying Legitimate Claims Using Engineer’s Reports
Insurance companies are denying more claims – including legitimate claims.
According to a recent report, insurers are using engineer’s reports and other tactics to deny legitimate insurance claims from honest policyholders. This is known as “plausible deniability”. The insurance company can state that they did not make the decision to deny coverage, the engineer did, further complicating the claim.
If an insurer has denied your claim, it’s not the end. There are proven ways to overturn a denied claim and get the money you are rightfully owed.
Keep reading to find out why insurers deny legitimate claims – and the next steps to take to receive the settlement you deserve.
More Insurers Are Denying Legitimate Claims
You buy a house and pay for homeowners insurance. You pay your premiums on time, and you expect your insurer to be there when needed most.
Unfortunately for homeowners, that’s not always the case: one report from a public adjuster in Florida found insurers are increasingly denying legitimate claims.
According to that public adjuster, insurers in Florida are using engineer’s reports to deny legitimate claims. Insurance companies hire an engineer to assess damage, and the engineer creates a report in favor of the insurer – at the expense of the policyholder.
How Insurers Use Engineer Reports to Deny Claims
According to the report, a growing number of insurers use engineer reports to deny claims.
Here’s how it works:
- When you file a claim with your insurer, your insurer investigates the claim.
- The insurer verifies the damage occurred due to a covered event – say, a windstorm and not flooding.
- In some cases, the insurer hires an engineer to inspect the damage and create a report. The engineer uses their professional expertise to assess damage, determine the cause of that damage, and present that information to the insurer.
- In the insurance world, the opinions of engineers tend to be valued higher than the opinions of adjusters. Adjusters generally do not have an engineering background. The engineer’s report may also use complex terms, making it difficult for the average homeowner to understand.
Ideally, the engineer is an unbiased professional.
However, engineers receive payment from insurance companies. Engineers who repeatedly rule in favor of the insurer may receive more business, creating an incentive to build a report that denies the claim.
How Engineer Reports Deny Legitimate Claims: Real World Examples
ABC Action News Tampa Bay recently covered three real-world examples of homeowners facing denied claims from engineer’s reports.
Those real-world examples include three separate claims where engineers blamed property damage on non-covered events – like termites and sinkholes – instead of covered events – like windstorm damage. Insurers used these reports to deny seemingly legitimate insurance claims.
Real World Example #1: Engineer Blames Foundation Damage on Sinkhole Instead of Burst Pipe
One homeowner in Clearwater Beach, Florida filed an insurance claim after noticing cracks and damage in her home. The patio was starting to cave and the roof was sagging.
One public adjuster attributed the issue to a leaking pipe under the home. The pipe leaked, causing erosion. Typically, this is a straightforward covered claim unless there is an endorsement to exclude pipes under the foundation.
When the homeowner filed a claim with the insurance company, however, the insurer felt otherwise: the insurer sent an engineer to the scene. The engineer determined the damage was caused by a sinkhole, which isn’t covered by a standard homeowners insurance policy.
Real World Example #2: Engineer in Charlotte County Blames “Green Wood” for Roof Damage Instead of Hurricane Ian
In a separate claim, a homeowner in Charlotte County blamed “green wood” for damage to the roof – not Hurricane Ian.
The homeowner noticed 25 shingles were missing after Hurricane Ian, so he filed an insurance claim.
The insurer, however, hired an engineer who disputed the claim. The engineer’s report concluded the roof was already slightly warped before Hurricane Ian because of green wood used by the roofer. As the roof dried, it became more warped. The home was built in the 1980s and had already survived three storms before Hurricane Ian.
Real World Example #3: Engineer’s Report Blames Termites Instead of Tornado for Recent Home Damage
A standard homeowners insurance policy covers tornado damage. Unfortunately, one Polk County couple faced a denied claim after an engineer blamed termites for tornado damage instead of wind.
The 2020 tornado caused structural damage – including a collapsed wall – to the couple’s home as it passed over. The couple made an insurance claim.
The insurer sent an engineer to the site to evaluate the claim. The engineer concluded the wall collapsed not because of tornado damage, but because of pre-existing termite damage.
Termites are a policy exclusion on many homeowners insurance policies. Insurers aren’t required to cover claims linked to termite damage in about half of the policies written.
How to Respond to a Denied Insurance Claim
If an insurer has denied your insurance claim using an engineer report or other methods, there are ways to fight back and get the money you deserve.
Some of the options available to you include:
- Dispute the claim. Most homeowners insurance policies have a formal dispute process. If you’re unhappy with the decision on a claim, you can file a dispute. The dispute process could involve bringing another adjuster to review the claim.
- Invoke the arbitration clause. If you and your insurer can’t agree on an outcome to your insurance claim, you can invoke the arbitration clause. Your insurance policy has an arbitration clause explaining how to resolve a dispute. Both sides agree on a neutral arbitrator, and that arbitrator reviews both sides of the claim to reach an agreement. In many cases, a public adjuster or attorney helps you with this process.
- Hire a public adjuster. According to a 2020 study by the Office of Program Policy Analysis and Government Accountability, homeowners using public adjusters increased payouts 747% higher than homeowners who did not use public adjusters. Public adjusters are insurance professionals who manage your claim, negotiate with the insurer, and fight to ensure you receive the compensation you deserve.
ClaimsMate’s public adjusters have a proven history of fighting back against engineer’s reports, overturning denied claims, and ensuring clients receive the exact dollar amount they deserve.
Contact ClaimsMate today for a free consultation with a public adjuster.
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.
