How to Appeal a Denied Homeowners Insurance Claim in 2023
There are many reasons a home insurance claim can be denied, such as if the claim was filed improperly or filed for damage that is not covered under one’s plan. However, not all denials necessarily mean that there is no chance for you to get a payout. It’s possible to appeal a denial and, in many cases, reverse the denial.
In some cases, even if your appeal is also rejected, you may be able to get your damages covered through legal action. Whether pursuing legal action is worth it will depend on your situation, but it’s worth noting that insurance claims are often for thousands of dollars in damages.
Key Facts
Key Facts
- A homeowners insurance claim can be denied for many reasons, such as a lack of appropriate coverage in your home insurance policy or insufficient evidence provided in your claim.
- Review the denial letter carefully and cross-reference it with your insurance policy.
- To appeal a denied claim, submit additional evidence, get third-party advice from a public claim adjuster, or file a complaint with the state insurance department.
- You may also have additional recourse after a claim denial, such as filing a complaint with the state insurance department.
Next Steps After Your Home Insurance Claim Is Denied
If your homeowners insurance claim is denied, take the following steps:
1. Read the Denial Letter Carefully
The letter will detail why your claim was denied, although the specifics of how these letters are written can vary by company and the specifics of your case. Read the letter multiple times. You may want a legal expert to review the letter to help you determine how valid the denial likely is.
2. Review Your Home Insurance Policy
With your denial letter nearby, review your home insurance policy. You want to check if what the letter claims is accurate. You’re looking for direct contradictions in your homeowners insurance policy compared to what is written in the letter.
The goal of this step is to determine how valid the denial of your claim might have been. In some cases, there may be no further action you can take.
If the letter correctly notes that your policy would not cover the damages, it will be difficult to impossible to successfully appeal the denial. However, if your policy makes it clear that you should have received coverage and your claim was still rejected, it is time to build and submit an appeal.
3. Gather Evidence to Support Your Claim
Claims that should be considered valid may be denied due to a lack of evidence. You will need to gather this evidence in order to successfully appeal a denial. Your goal is to prove that the damages that occurred should be covered by your policy and that the amount of money being requested is reasonable to repair and/or replace damaged assets.
Some examples of evidence that can support your claim include the following:
- Photographs and videos of the damage you want repaired
- Documents showing the extent of the damage, including the estimated cost of the damage
- Quotes from multiple contractors proving the amount you claim is needed for your repairs is accurate
Expert Take
Make sure the documentation you provide is thorough, relevant, and accurate. If you’re sending pictures, send before-and-after shots whenever possible. If you can, take photos in good light, and make sure to clearly show the damage.
4. Speak to the Insurance Company Again
With all the above information gathered, contact your insurance company. If possible and legal in your area, you will likely want to record the call in the event you need to take legal action in the future.
Find out as much as you can about why your claim was denied. Additionally, ask what evidence and/or corrections would allow you to successfully appeal their denial, if any.
If your policy seems to directly contradict the reasoning given in your letter for your denial or any additional reasoning discussed in the call, mention that. Ask for clarification whenever there is a seeming contradiction. However, remember that this call is not your appeal. It’s unlikely you will resolve the issue over the phone.
Be very wary about agreeing to anything on the phone, especially because the insurance company is likely recording the conversation. Do not accept responsibility for any damages or say you did anything in error.
It’s very important that you also don’t make any fraudulent claims during the call. Exaggerating or lying has the potential to open you up to legal action and make it more likely that you won’t be able to appeal the denial.
5. Get Advice From an Unbiased Claim Adjuster
Something that can be valuable before filing an appeal is getting advice from an unbiased public adjuster. A public insurance adjuster, also called a public claim adjuster, is a professional whose job is to evaluate damages and determine a fair payout based on your insurance and the extent of the damages.
Insurance companies will generally send their own adjusters to evaluable a claim. However, it can be valuable to get an unbiased, expert opinion from a public adjuster, especially if you think the adjuster sent by your insurance company made an error or evaluated the damages unfairly.
A public adjuster can give you advice on how to proceed. They may recommend you appeal, that you speak with your insurance agent again, or that you accept the denial.
6. File an Appeal
At this stage, assuming you still believe your claim was valid and that your insurer ought to cover the damages based on your policy, you can appeal their denial of your claim. An appeal is essentially a formal declaration that you think the company’s decision was erroneous and/or that you can present additional information that was missing proving the claim was valid.
Many companies detail the specifics of how to file an appeal with them on their site. Even if they don’t, they will explain the basics of the process if you call them.
Typically, an appeal is filed via sending a physical letter to your insurer. Before sending your letter, make sure all information in the letter is accurate and that it presents your case as strongly as possible. If your insurer has forms you need to fill out to file an appeal, make sure you have completed all of them and submit them appropriately.
Some items to have in your appeal letter include the following:
- Photo evidence
- Date of damage
- Date of claim filing
- Explanation of your understanding of the policy
- Public claim adjuster quotes
- Contractor quotes
7. File a Complaint With the State Insurance Department
If your appeal is not successful but you still believe your claim is valid, you will need to find an alternative path to getting your payout. Before pursuing private legal action, which can be costly and time-consuming, consider filing a complaint with your state insurance department. While the specifics can vary by state, most states have a fairly straightforward way in which you can complain an insurance company may be acting illegally.
Information on how to contact your state’s insurance department is usually easy to find online. In some cases, this department may have other duties as well, such as New Jersey’s Department of Banking & Insurance.[1]
The easiest way to know how to proceed with your complaint is simply to ask. The professionals working in the department should be able to outline the steps you need to follow to collect any information they will need and file your complaint. They can then investigate it and act appropriately based on their findings.
Ask them directly about timelines. These investigations have the potential to be lengthy.
8. File a Lawsuit
Filing a lawsuit is the last option on this list for a reason. Pursuing legal action against an insurance company can be expensive and time-consuming. If there is a cheaper or quicker way to get your insurance claim paid out, it should generally be pursued first.
Despite the cost, filing a lawsuit is sometimes still the best path forward. If your appeal has been denied and you know your claim is valid, you stand to lose out on thousands of dollars you may need to repair damage to your home. If filing a complaint doesn’t produce any results, at a certain point, filing a lawsuit becomes a matter of math.
A home insurance lawyer will cost a certain amount of money and should be able to tell you roughly your chances of successfully winning a lawsuit against your insurer. If you win, you will get your payout (and potentially more, depending on the nature of the case).
Expert Take
Many lawyers offer a no-charge consultation, so you can explore your options and the potential worth of pursuing legal action without breaking the bank.
If you’re very likely to win the case and will make more money than the lawyer costs you if you win, it may be worth pursuing legal action. However, keep in mind a court victory is seldom guaranteed.
Frequently Asked Questions About How to Appeal a Denied Homeowners Insurance Claim
These are some of the most frequently asked questions about how to appeal a denied homeowners insurance claim in 2023:
First, thoroughly read both the denial letter and your policy. This should help you understand whether you might have a case to appeal or if the denial was valid. If you believe you can appeal the denial, file an appeal within the specified deadline. In some cases, consulting an insurance lawyer may be a wise step.
Yes, you can appeal the denial, often by sending a letter to your insurance provider. Your insurance provider will have an explanation of their appeals process on their website. Make sure you file your appeal very carefully, providing as much relevant information as possible and keeping your appeal free of any errors.
You don’t need a lawyer to appeal a home insurance claim denial. While the process can be time-consuming and tedious, filing an appeal isn’t so complex that it requires a legal expert. You may consider consulting a lawyer if your appeal gets denied but you still believe your insurance claim is valid.
Reviewed by Lisa A. Koosis
Lisa A. Koosis is an experienced content writer who has ghostwritten extensively for clients in the insurance and finance sectors. As a subject matter expert, she can explain complex financial topics in easy-to-understand language. Lisa is well-versed in topics ranging from life insurance to pet plans and specializes in medical insurance including Medicare, Medicaid, and commercial plans.
Sources
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Division of Insurance – Consumer Protection Services. State of New Jersey Department of Banking and Insurance