You purchase fire insurance to protect yourself from fires and smoke damage.  Sadly, insurance companies do deny fire insurance claims. If your fire claim is denied, you will ask yourself, “Why would my insurance company deny my fire insurance claim?”.  Insurance companies use several excuses to try to get out of paying fire claims.

Fraudulently Alleging Fraud

One technique used by insurance companies to deny claims (including fire claims) is to accuse you of insurance fraud.  Your insurance company may use obscure phrasing when describing the details of your property damage, such as not being able to determine the origin of the fire, suggesting accomplices and scenarios you staged to defraud the insurance company, and suggesting you are lying or concealing the truth.

Asinine Allegations of Arson

Insurance companies love to accuse their insureds of arson, even if the local fire department rules out arson.  Obviously, if you set the fire then your claim will be rightfully denied, but the general public would be shocked at the amount of times an insurance company accuses it’s insured of arson with zero proof.  Even if the insurance company eventually pays the claim they love to use the “arson card” to substantially delay payment of the claims (repeatedly telling you that the fire is “still under investigation).

The burden of proof lies with the insurance company when it comes to proving arson.  They cannot deny your insurance claim based on speculation alone. Without proof, when an insurance company denies an insurance claim, they do so in bad faith.  The bad faith is obvious with the local fire marshal does not find arson and the insurance company still accuses you of arson.

Good Documentation Practices

The problem with a fire is that what the fire doesn’t destroy, the water from the fire department does.  If you cannot document your personal property (that has been burned to ashes or is so wet it is beyond repair) then you will have a hard time recovering from your insurance company.  With the advent of cameras on cell phones, the following advice is pretty easy for any insured to follow and if you do it, you will be very well prepared to prove your claim after a fire.  Go around your house doing a video inventory of all of your personal property (or at least your most expensive or prized possessions).  Take photos of any receipts or appraisals you have that show the value of the item.  If you store your photos on a cloud then you will always have proof of your lost items.  You should also spend a few hundred dollars on a very good fireproof and waterproof safe.  In the safe, you should store all valuable papers, receipts, appraisals, and anything that will help you prove the value of your personal property.

Unlicensed Electrical

Another way insurance companies try to deny fire claims is by alleging contractor error.  Your insurance company will blame your electrician for faulty wiring.  For these reasons, we cannot stress enough the importance of hiring a licensed, bonded, and insured electrician to do quality work. As a responsible homeowner, you have a duty to maintain and keep your home in a good condition.

By having an unlicensed contractor or handyman perform unlicensed or shoddy work on your home’s electrical system, you allow your insurance company the option to deny your insurance claim.

Paying Your Premiums

If you did not make your premium payments on time, then your insurance company can deny your insurance damage claim. Pay premiums on time to prevent your insurer from using your history to get out from paying your insurance claim.

Illegal Activities

Your property insurance claim can be denied if your fire damage is the result of illegal activities. For instance, if you were stealing electricity from your neighbor’s house and your house burns down because of the theft, then the insurance company can deny your insurance claim.

Any number of illegal activities might cause your insurer to deny your claim.

Underpaying & Stalling Claims

Stalling is a tactic insurance companies use you goad policyholders into accepting a lower insurance payout. An insurer can require unreasonable proof, question every facet of your insurance claim, and utilize every conceivable justification to lower or delay a claim settlement.

Through all these possibilities, the insurer might not be operating in good faith. If an insurer doesn’t respond to their policyholders in a timely fashion, that insurer is acting in bad faith. When your insurance company acts in bad faith, call the expert property insurance lawyers at the Chad T. Wilson Law Firm at (833) 942-0678.

Our attorneys work on a contingency basis, meaning if we don’t win your case, we don’t get paid. Maximize your insurance claim settlement with the Chad T. Wilson law firm. No recovery equals no fee.