The Coalition Against Insurance Fraud estimates that the average person pays close to $1000 per year in combined costs for homeowners, life and health just to cover fraudulent claims and associated costs.
This is just one of the reasons why insurance companies treats claims, especially large property loss claims, with much circumspection. The other reason is that paying out large claims quickly erodes the insurer’s bottom line.
The average person or business who’s been dutifully paying increasingly larger premiums for years, expects the benefit of the doubt when the need arises for them to use their insurance. Thus, they may be unpleasantly surprised to discover the insurance companies may employ a series of tactics solely designed to delay, minimize or fully deny their claim settlement.
Some of these tactics include: raising suspicions about the loss without much evidence, employing their investigators to “uncover” negligence or wrongdoing on the part of the insured, needlessly delaying the claim process, or forcing unjust settlements on cash starved homeowners or business owners.
In a perfect world, insurance companies would not operate this way. However, with over 1000 insurance companies doing business in Michigan, there’s not just healthy competition and smaller premiums for you, but also thinner profit margins for them. Insurers do not want to take unjustified losses. Thus treating your claim with suspicion, raising questions about its validity, hiring investigators to pin something on you – it’s not personal, it’s just lucrative business practice.
At the same time, at least in Michigan, insurance companies have the law on their side. Michigan law does not allow for punitive damages for insurance companies. They can underpay or deny claims without fear that they will be penalized for it. The worst that can happen, from their point of view, is that they get sued and end up paying a the full settlement. Still, they are, under the law, supposed to act in good faith in their dealing with the customers. But customers cannot sue insurance companies for unfair trade practices, only state regulators can – not something that happens often, or that has much consequence for the industry.
Moreover, after having lost their home or business to fire, floods or other disasters, cash strapped homeowners and business owners may have little in the way of resources or even energy to put up a prolonged and expensive legal battle, especially when they have to pay the legal fees out of the final settlement, or out of pocket if they do not win a larger settlement.
In our public adjusting business, we have seen case after case, where claims were denied based on ungrounded or false accusations. This is especially true with large fire losses. Months or years after the fire, homeowners were still looking for justice in courts. By now, their financial security was badly damaged, and even a successful court settlement was not enough to help them fully recover the original losses plus the additional costs incurred.
When an experienced public adjuster gets involved right from the start, thorough claim documentation, accurate appraisals and adequate evidence to prove the validity of the loss, will make the case to the insurance company and get the claim process moving in the right direction from the get go.
With large property losses, it just doesn’t pay to take any chances. The claim process is a zero sum game. Your gain is your insurer’s loss. Having a licensed professional with industry knowledge working on your behalf significantly increases your chances of a timely and advantageous settlement and minimizes the chance for expensive litigation.
Contact us with any question regarding your property loss claim. As one of the leading public adjuster companies in Michigan, we’ll help expedite your financial recovery after losses from fire, water, floods, and storms. Our team of appraisers, estimators and public adjusters will work to assure best possible settlement and your complete satisfaction.
Michigan Fire Claims, Inc.’s public adjusters, will assist you in any way possible to help you steer clear of all the pitfalls insurance companies are counting on. We work for you!
Disclaimer: The purpose of this article is for general information only and does not provide legal advice either express or implied. For information relevant to your own property loss claim, please contact one of our public adjusters.
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