Five Reasons Insurance Companies Deny Fire Claims
Posted on Saturday, February 10th, 2024 at 9:00 am
Do insurance companies deny fire claims? A house fire is a nightmare for many people. The fear about the safety of family and pets and the overwhelming sense of loss afterward make this an incredibly stressful and emotional time. As you’re sorting through the fire and smoke damages to your home and belongings, you likely feel a sense of relief that your homeowner insurance will cover your fire damages claim.
What happens if the unthinkable happens, and the insurance carrier denies your claim? There are many reasons why an insurance company may deny a fire insurance claim, and not all of these reasons are on the up and up. If your insurance company is denying your fire damage claim, and you’ve paid your insurance premiums in good faith, it may be time to get legal advice.
In What Circumstance Would a Property Insurance Claim Be Rejected?
There are multiple reasons that insurance companies deny fire claims. The carrier should provide a reason, in writing, for the claim denial.
Denial Reason #1: Arson
If the carrier suspects that you deliberately set your house on fire to commit insurance fraud, then it may deny the claim. As a homeowner who dealt with the company in good faith, this may feel like an insult on top of injury.
If you’ve filed similar claims with the insurance company in the past, then they may deny your fire claim out of hand. This puts the onus on you, the homeowner, to prove that you didn’t cause the blaze intentionally. If this happens, you should probably involve an attorney, as you may have to prove in court that neither you nor another party acting on your behalf caused the fire.
Denial Reason #2: Damage Isn’t Covered by Your Policy
Your policy may not cover some fires caused by “acts of God” or “acts of war.” Check yours to see what your coverage for a catastrophic event is. Or maybe your policy covers damage caused by the fire but not the smoke or water damage that follows.
Denial Reason #3: Poor Home Condition
If you allow your home to fall into disrepair or construct it poorly, you face a higher risk of a fire. For example, if you have an older home and don’t have the wiring updated, then the insurance company may deny the fire. Or, if you had a renovation or addition constructed that wasn’t to code or was made using materials that are ineffective for fire protection (or those that have since been recalled for poor performance), then the carrier may deny the claim based on these grounds.
Denial Reason #4: Relevant Information Missing from Your Claim
Some homeowners may omit information in the claim, either accidentally or because they believe they may receive blame for the fire or have the claim denied. This may include a possible source of the fire, like a candle or a stove left on. Or maybe they omitted information because they didn’t realize they needed to include it. A lawyer may be able to help you if this happens in your case. They can appeal the denial and supply additional necessary information.
Denial Reason #5: Disputing the Claim’s Value
Sometimes, the insurance carrier will approve the claim for the damage but deny the full amount of the costs to repair it. Underpaying fire damage claims is common. It’s wise to have an independent assessment (by a party not affiliated with or recommended by your insurance company) of the damage so that you have a second opinion.
Be aware that the first offer from the insurance company is almost certainly less than the true value of your claim. You may negotiate for a higher settlement or ask for written reasons why the adjuster came to that total.
Retain copies of the initial damage valuation, as well as estimates of the repair and reconstruction costs, as this can help you substantiate the value you place on the claim.
Does Fire Insurance Cover Negligence?
No, in most cases, the carrier may not cover the fire if the fire occurred because of homeowner negligence. If someone else’s negligence caused the fire, you may have grounds to file a suit against that party for the losses you sustained.
Keep your home in a safe condition, or you risk invalidating your insurance policy. This may mean putting the right electrical wiring in place or taking care of any repairs right away so they don’t become a safety hazard.
What Can I Do If My Fire Insurance Company Acts in Bad Faith?
Some insurance companies may devise spurious reasons to avoid paying valid fire insurance claims. If you believe your claim was denied or underpaid in error or have been treated in bad faith by your insurance company in Ohio or Kentucky, call Lawrence & Associates at (513) 351-5997 today. Our team of attorneys offers a free consultation.