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A Settlement Check is Not a Gift from Your Insurance Company

On Behalf of | Dec 31, 2018 | Firm News |

It is the holiday season, and now that it has been several months since Hurricane Michael passed through Florida, some homeowners are starting to receive settlement checks from their insurance companies. But, while it may seem that these checks are coming at the perfect time, homeowners need to be careful to avoid resolving their claims too soon.

As we discussed earlier in the year, some insurance companies include “release” language on their settlement checks. This language purports to release the insurer from any liability for the subject claim beyond the amount of the check. While it is not clear whether the Florida courts would enforce this type of language – particularly when it is included on the back of a settlement check that the insurance company sent voluntarily – it nonetheless creates the potential for disputes that policyholders would be better off to avoid.

When Can You Accept a Settlement Check from Your Insurance Company?

So, when is it okay to sign and deposit a check that you receive from your homeowner’s insurance or flood insurance carrier?

First, not all insurance carriers use this tactic. If you receive a settlement check that is devoid of any “release” or “waiver” language and your insurance company is not attempting to have you fully settle your claim, it can be okay to accept a partial payment. While it is good to be cautious, it is not entirely unusual for insurers to make partial payment in order to facilitate the repair process.

Second, in order to make an informed decision about resolving your claim, you need to know the full amount of coverage to which you are entitled. Relying on your insurance company’s appraisal can be risky, and many homeowners will benefit from hiring a public adjuster.

What if Your Insurer is Refusing to Fully Compensate Your Claim?

If you get into a coverage dispute with your insurance company, it will be important to assess your options promptly and take appropriate measures to enforce your rights under your policy. This could mean hiring an attorney to deal with your insurance carrier for you; or, it could mean invoking your right to an appraisal or filing a claim in court. Unfortunately, disputes between homeowners and their insurance carriers are common – especially after major hurricanes and other catastrophic events – and homeowners cannot necessarily rely on their insurers to voluntarily uphold the terms of their policies.

While you can expect to deal with a certain amount of delays and red tape when you file a property damage insurance claim, your insurance company must handle your claim in good faith. While not universally the case, receiving a check for a fraction of what you are owed and being asked to waive your rights are often signs of bad faith insurance practices.

Speak With an Insurance Claim Lawyer in Broward County, FL

Are you having trouble securing full payment from your insurance company for damage to your home? If so, our lawyers may be able to help. For more information, call our Broward County law offices at (954) 928-9568 or request an initial consultation online today.

Founding Partners Damaso W. Saavedra and Allyson D. Goodwin