January 31, 2017 | Share
Common Issues with Hurricane Damage Insurance Claims
If your home or business has been damaged in a South Florida hurricane, securing payment from your insurance company is one of the first steps on the road back to normal life. Unfortunately, while insurance companies are happy to collect policyholders’ premiums, getting them to pay for covered damages can often be a very different story.
Insurance Company Excuses for Denying Insurance Coverage After a Hurricane
The following are all common issues property owners face in dealing with their insurance companies in the wake of a hurricane:
1. Denial of Coverage Based on Lack of Flood Insurance
While flood insurance coverage is necessary for certain types of hurricane-related damage, ordinary home owner’s insurance and business property insurance policies cover many types of damage caused by hurricanes. As a result, your insurer should not deny your hurricane damage claim based solely on the fact that you did not purchase flood insurance. Your insurer should investigate your claim promptly and in good faith, and provide coverage for any damage not specifically excluded under your policy’s flood damage clause.
2. Denial of Coverage Based Upon Storm Surge
If you live near South Florida’s Atlantic coast, your insurer may attempt to deny your claim on the basis that the damage to your home was caused by storm surge. Storm surge is considered a flooding event, and it is excluded under typical homeowner’s insurance policies. However, damaging winds always precede storm surge, and as a result much of the damage that coastal homes sustain during hurricanes should be covered even in the absence of flood insurance.
3. Refusal to Pay “Overhead and Profit” Up Front
In addition to charging for labor and materials, contractors charge “overhead and profit” expenses for hurricane damage restoration and repairs – usually at a combined rate of 20 percent. Many insurers will attempt to hold back payment for overhead and profit until the work is complete, yet most contractors will not start work until their “O&P” is covered. Your insurance company should pay your contractor’s O&P up front, and if it refuses to do so you should speak with an attorney about enforcing your right to timely coverage.
4. Deductions Based Upon “Depreciation”
Insurers will often attempt to limit their liability for hurricane damage by only paying the depreciated value of items damaged in the storm. This is true even for policyholders with full replacement cost coverage. While certain building materials depreciate over time, others do not, and insurance companies’ depreciation estimates are largely subjective. As a result, you should not let your insurance company take advantage of you by over-depreciating the value of your home or business.
Take Action to Secure Appropriate Coverage – Contact Saavedra | Goodwin
If you are struggling to secure appropriate coverage from your insurance company in the aftermath of a hurricane, the attorneys at Saavedra | Goodwin can help. To schedule a consultation about your hurricane damage claim, call our Fort Lauderdale law offices at (954) 767-6333 or contact us online today.
Categories: Insurance Claims