Homeowner's Property Damage Claims
Florida is an ever more popular destination for people from northern states seeking milder weather during the winter season. However, Florida is also well-known for having unpredictable weather during the hurricane months, which can leave houses and other properties with extensive damage from heavy rains, strong winds, and flood water. This kind of property damage may lead you to file a claim with your homeowner’s insurance company to get remuneration for the repairs or replacements that are necessary. However, natural disasters like hurricanes are not the sole causes of residential property damage in Florida. Homeowner’s insurance claims can also stem from other events such as fires, smoke, pipe bursts, mold, pests, roof tile damage, or termites. Homeowners may also file claims for crimes such as theft, vandalism or burglary.
If your house has been damaged because of a natural disaster, criminal activity, or another event, you may be entitled receive compensation from your insurance company for the damage your home sustains. You should contact Englander Peebles' Homeowner's Property Damage Claim Lawyers as soon as possible after a loss. Often, your insurance company may deny your claim outright or only partially approve it and provide only partial payment for the damage to your home. Englander Peebles can assist you in getting the proper documentation that you need to file a homeowners’ insurance claim with your insurance company. Englander Peebles will work with the appropriate damage experts to analyze the damage to your home.
Types of Homeowners’ Insurance Policies
Homeowners may acquire insurance policies for one to four family dwellings. Six major types of policies cover homeowners, owners of condominiums, and renters. Other kinds of policies include mobile homes or trailers.
- HO-1 policies are considered to be basic policies which only cover named perils.
- HO-2 policies, or broad-form policies, are policies that only cover specific kinds of perils that are listed in the policy. These may include lightning, hail, fire, explosions, or other weather-related events. Only the perils listed in these policies are covered – everything else is excluded.
- HO-3 policies or special form policies are the most common type of policy. These are typically known as open perils policies that cover all direct damages to the home or other structures on the covered property unless the policy specifically excludes them.
- HO-4 policies or contents broad form policies are modified HO-2 policies for renters. These are named-perils policies that cover personal property and some liability insurance.
- HO-5 policies, or comprehensive form policies, are also open perils policies but include direct damages or losses to personal property, unless specifically excluded.
- HO-6 policies or unit owners policies are intended specifically for owners of cooperatives or condominiums. For insurance purposes, condominiums consist of two components – the unit, and the building/common areas. HO-6 policies are named perils types of policies that cover certain semi-permanent structures such as wallpaper, kitchen cabinets, built-in appliances, carpeting, etc. but do not provide coverage for the structure itself or other common areas since the condo association should provide coverage.
- HO-8 policies, or modified coverage form policies, are intended for older homes that may have replacement costs that are much higher than the market value of the home. Normally, insurance companies will refuse to cover a home for a greater amount than its market value. HO-8 policies will pay out the cost to repair or replace damaged property using common materials and construction methods. This is typically known as a functional replacement.
Common Reasons Why Insurance Companies May Deny A Claim
Because of the high demand, there are several large homeowners' and renters' insurance companies in Florida, such as Citizens, Tower Hill, Universal, United, and Castle Key. Often, homeowners’ insurance companies such as the companies listed above or others refuse to pay the exact amount claimed by the property owner, or may deny the claim completely. There are a few common reasons that an insurance company may deny a claim for damages to property, including the following:
Failure to Pay Premium Payments
Outstanding or unpaid premiums are a common reason why an insurance company may deny a claim. There are many reasons for such outstanding premiums, such as the illness prevented the insured individual from making payments, or the insured individual was forced to choose to pay hospital bills instead of insurance premiums. If a claimant failed to pay premiums or are late in making payments, then an insurance company will likely deny the claim. Additionally, there may be requirements in the policy that require the insurance company to provide the insured individual with a period to become current with his or her premium payments.
False Statements in Initial Insurance Application
At the time that an insured individual files a property damage claim with his or her homeowner’s insurance company, the company will validate the claimant’s initial application against the company’s background investigation and the documentation submitted by a claimant in support of the claim. If the company becomes aware that that the insured individual made false statements or otherwise provided false or exaggerated information in the application, the company will likely deny the claim. Additionally, the company may rescind the policy, and there is a risk that the company may sue the person for any previous payouts that it made under the policy.
Exclusion Clauses in Insurance Policies
In all homeowner’s insurance policies, there is an exclusion clause that lists the kinds of damage that the insurance company will not cover. In Florida, some policies will exclude or place limitations on the amount of coverage for damages related to animals. For certain portions of Central Florida, sinkhole coverage is difficult to acquire, and companies will offer separate sinkhole coverage apart from a homeowners’ insurance policy. Unusual or dangerous property features such as un-screened pools, skateboard ramps, trampolines, and diving boards may be excluded from insurance coverage. Finally, damage from water and theft are usually excluded from basic Florida insurance policies.
Claims Filed by Negligent Property Owners
One of the common reasons that insurance companies deny property owners’ claims is because of the recklessness or negligence on the part of the property owner. If an owner was negligent in making repairs or otherwise preventing damage to the property, then the company may deny the owner’s claim. In other words, the insurance company can show that the damage could have been prevented if the owner fixed or otherwise performed normal maintenance on the property, the insurance company may deny the claim. If the company finds an owner was negligent, it may deny the homeowner’s insurance claim.
The Claim Exceeds the Allotted Coverage
Homeowners’ insurance policies often detail limits to the amount of damage protection that a company may provide to a property owner. These limits mean that properties are insured only up to a particular amount. Therefore, property owners are only allowed to file claims for an amount up to the amount that is covered under the policy. If a property owner needs coverage for a larger amount, he or she may need to acquire an insurance rider to increase the coverage.
Filing Too Many Claims
Another reason that insurance companies deny claims filed by property owners is that the owners have filed too many claims within a short period. Insurers expect that owners’ damages do not occur frequently, if at all, and making too many payouts may cause them to lose money. In response, an insurance company may not only deny the claim, but cancel the policy altogether.
In the event that a homeowners’ insurance company denies your insurance claim in South Florida, Englander Peebles is here to assist you in obtaining the compensation you deserve. In the event that your insurance company is not cooperating or acting in good faith in resolving your claim, Englander Peebles has the experience to file a lawsuit on your behalf.
Obligations of Homeowners’ Insurance Companies
Insurance companies must act in good faith in interpreting their policies and investigating and paying claims. In turn, Florida insurance companies may be liable for acting in bad faith.
Insurers are not allowed to act in bad faith towards the insured, such as unreasonably delaying the processing of claims, underpaying claims, and otherwise engaging in deception in selling policies or handling claims. Insurance companies must not leave an insured person with no choice but to hire a lawyer to receive a payout. Failure to engage in good faith may make an insurance company liable for significant damages.
Bad faith is defined as unfair or unreasonable conduct by an insurance company. This type of conduct may include:
- Efforts to diminish, delay, or deny payment without a reasonable or fair basis;
- Failing to approve or deny coverage of a claim – and providing notice to the insured in a reasonable manner – within a reasonable period after the filing of the claim;
- Engaging in illegal or fraudulent procedures, practices, or methods;
- Attempting to settle an insurance claim for an amount that is less than the amount a reasonable client would normally expect;
- Diminishing a claim in a manner that ultimately forces the client to enter into litigation with the company;
- Failing to acknowledge appropriately and provide prompt and accurate responses to a covered claim;
- Knowingly using inaccurate or incomplete information to deny, diminish, or payment of a valid claim;
- Attempting to settle claims using insurance policies or applications that the insurance company altered without appropriate notice to and consent of the insured individual.
- Victimizing the client by engaging in demeaning, intrusive, or harassing procedures and methods of investigation and information-gathering.
Insurance companies who engage in bad faith conduct may be liable for punitive damages in Florida. Under Florida’s civil remedy statute, insurance companies may be liable for punitive damages if their conduct is wanton, willful, and malicious, or recklessly disregards the rights of an insured person with such frequency that it is determined to be its general practice as a business.
Ambiguities in the language of the policy must be interpreted in the insured’s favor and against the insurance company.
The language of an insurance policy is extremely important to the parties. Insurance policies are drafted by the insurance company. Therefore, any ambiguities in the language it writes and selects will be resolved by the court in favor of the policy holder and coverage of the claim. Insurance companies have the burden to clearly write language excluding or limiting coverage.
The insurance company has the burden of proving the applicability of an exclusion or limitation in the policy.
Initially, the insured person bears the burden of proving that a loss from an event is covered by an insurance policy. Courts will look to a plaintiff in such cases to show that a claim against the insurance company was within the policy’s coverage. Additionally, the insured person bears the burden of proof to show that the loss claimed occurred within the period of the policy and that the amount of the loss is within the amount covered by the policy. However, once the insured person establishes that he or she suffered a loss within the terms of the policy, the insurance company has the burden of establishing that the loss stems from a cause or event that the policy specifically excludes. Additionally, the insurance company has the burden to prove that there is no coverage for the entire claim if the question arises during the course of the proceedings.
In Florida, many insurance companies issue “all risks” insurance policies that provide coverage for all losses that do not stem from fraud or misconduct unless specifically excluded by a provision of the policy. With respect to all-risks policies, insurance companies bear the burden of proving that the cause of the loss in the claim is excluded from coverage under the written terms of the insurance policy.
While Florida law permits insurance companies to rescind insurance policies because insured individuals answered questions incorrectly or incompletely during the initial application, there are limitations to this ability to rescind.
As discussed above, insurance companies often review insurance applications once an insured person files a claim to determine if they provided incomplete information or incorrectly answered questions. This is because Florida law allows insurance companies to rescind insurance policies and prevent insured individuals from receiving payouts under the policy because of the incomplete or incorrect statement. Specifically, Florida law provides that a misrepresentation, incorrect statement, concealment of fact, or omission may prevent an insured person from recovery under an insurance policy if it was material to the assumption of the hazard or risk by the insurance company. Additionally, the law would bar insured from recovering if the insurance company can prove that, if it was aware of the misstatement or omission, the company would not have issued the policy or would have issued it at a higher premium rate or with additional exclusions.
Assignment of Benefits
In recent years, Florida state courts have been flooded with numerous cases dealing with the issue of the assignment of insurance benefits by homeowners’ insurance policyholders to third parties, such as home damage remediation and repair companies and contractors, without advanced approval by their insurance providers. These third parties then file claims as assignees of insurance benefits, and the insurance companies either deny the claim in total or only provide partial payouts. As these cases make their way through the system, it appears that Florida courts favor the assignability of insurance benefits unless the language of the insurance policy itself prohibits the assignment. As a result, insurance companies may be revising their policies to include specific language to that effect.
Florida law permits individuals to assign contractual rights unless the contract itself forbid assignment, the contractual obligations are personal in nature, or other public policy considerations prevent the transfer of such rights. Additionally, Florida statutes allow insured persons to assign benefits under homeowners’ insurance policies depending upon the actual terms of such policies. In the context of normal contract law, a party has the right to sue to recover money or debt arising out of a contractual relationship and is able to assign such right in Florida. Once assigned, the assignee may sue under his or her caption and rights. Insurance policy claims should not be treated any differently, and are therefore assignable as deemed necessary by the policy holder. Unless a homeowners’ insurance policy specifically forbids assignment of benefits to a third party, insured individuals should have the right to assignment.
Contact Englander Peebles Today for a Free Consultation
If you or a loved one has sustained property damage, it is important that you consult with a Fort Lauderdale Property Damage Claim Attorney immediately. The attorneys at Englander Peebles will review your homeowners insurance policy and assist you in navigating the insurance claim process. We will fight for your right to compensation so that you can repair or replace your property. Don't fight your insurance company alone. Contact Englander Peebles today at (954) 500-4878 or through our online form to schedule your free initial consultation.