You and your insurance company have conflicting interests. Your insurance company wants to pay as little as possible in claims in order to stay profitable, and you want maximum reimbursement for your damaged property. You may need legal help to get an insurance claim paid on time and in full.

This article will go over your options to fight a home insurance claim decision. It will also cover scenarios in which you may need to seek legal help, and what to consider when doing so.

In this article, we'll answer the following:

Why you may need legal help with an insurance claim

In its 2020 Property Claims Satisfaction Study, J.D. Power found that the "customer satisfaction with homeowners insurance property claims is 881 on a 1,000-point scale." The study also found that "satisfaction for property claims has reached a record high." However, some individuals are left unsatisfied with their property claims.

For more expensive claims, there may be a higher chance of dispute. There are three common situations where a conflict can arise between you and your insurer:

1. Claim denial

Your insurance company may deny your claim outright. "Many times, these denials arise out of the insurance company's misapplication of an exclusion under the policy," says K.C. Williams III, a Florida attorney.

According to Williams, common exclusions include "that the damage was pre-existing, that the damage was the result of neglect and a lack of maintenance, or that the damage was not from a cause of loss listed under the policy."

Before making a claim, you should review your policy to find out the types of incidents that are covered and the maximum value you can get for a claim.

2. Lowball payout

Getting your claim approved is one thing. Securing proper valuation for your property is another. "This is probably the most common type of dispute between consumers and insurance companies," says Williams. "The insurance company will attempt to only pay the minimum amount possible on any given damage claim."

Insurers may undervalue the cost of repairs, refuse to cover certain repairs or not inform consumers about potential policy benefits.

Part of the terms of a settlement is that your claim is closed and you cannot legally contest it anymore. You shouldn't accept a settlement for less than you deserve since this is a permanent decision.

3. Delayed response

You might find yourself waiting to hear back from your insurance company about your claim. This is especially true after a major disaster, when insurers are swamped with claims. Though delays aren't always done in bad faith, they may be intentional.

Insurers "simply are in no hurry to write you a check," says Thomas Simeone, an attorney in Washington, D.C. "They are acutely aware that the longer they delay, the more claimants will get frustrated and give up or accept a lower amount." An attorney can help expedite this process. "If the insurance company is delaying in considering your claim, having an attorney call - which raises the threat of litigation - may persuade the insurance company to act."

How to fight a home insurance claim

Regardless of the reason behind your dispute, fighting your insurance company is not a simple task. It usually involves a mountain of paperwork, complex insurance jargon, and a lot of time and effort. And you're going up against an insurance company filled with experience, staff and the resources to fight back. The deck is stacked against you. Unless you're well versed in the ins and outs of insurance, you may be fighting a losing battle. Although you would have to share your settlement with a third party, a home insurance lawyer or public adjuster - an independent insurance professional - can help you with the claim process.

After a claim is denied or you don't secure a proper valuation, you'll want to act fast. You may have a set amount of time to respond if your claim is denied or lowballed. "Each insurance company and state handles claims differently. That limit can be 90 days, 180 days or any limit your insurer sets," says Russel Lazega, an insurance claim lawyer.

How to dispute a homeowners insurance claim

Hiring a lawyer can be expensive. There are several steps you should take before you consider legal help. Start with these three:

  1. Identify the dispute: What caused the conflict? Understand what your issue is and why it happened. When communicating with your insurance company, make sure you get all statements and information in writing. You should also review the claim you filed and consider if there are any additional documents and evidence you can send to strengthen it.
  2. Gather the paperwork: If you're going to successfully argue your claim, you'll need the paper trail to prove you're right. Gather copies of inspection reports, estimates, measurements, notes, damage assessments and more. If you need help getting documents from your insurer, you can view a sample letter from United Policyholders, a nonprofit insurance consumer advocacy group.
  3. Hire an appraiser: Insurance companies usually send an adjuster to evaluate damage levels and repair costs. However, these adjusters work for the insurance company and on behalf of its interests. If you hire your own public adjuster, he or she will fight for a claim result on your behalf. Remember, however, that public adjusters can only negotiate with your insurance company. If you need to litigate, you'll need an experienced lawyer.

If you've tried all of these options to no avail, it's time to consult legal help.

Why hire a homeowners insurance attorney?

Needing a lawyer to fight an insurance claim is relatively rare. But you'll want a lawyer if you've exhausted all other avenues and you're still unsatisfied with your payout.

"If the insurance company's offer is close to what you demanded, it may not be worth the cost of paying an attorney to obtain a larger settlement," says Simeone. "However, if there is a big difference between what the insurance company offers and the value of your claim, then you should consult with an attorney."

Getting legal help can be expensive. However, hiring a lawyer to fight for your claim payout can be less of a financial risk than you may think. If you hire a lawyer for a contingency fee, they will only get paid a percentage of the claim amount they recover. In this case, a lawyer has to win the case in order to receive payment. As a client, you risk little to nothing if you hire a lawyer for a contingency fee.

If a lawyer is willing to handle your case on a contingency-fee basis, it means you likely have a good case. This is true even for relatively small claims. "Since the homeowner does not have to incur any out-of-pocket costs to retain a lawyer, there is no deterrent against seeking legal assistance, even on small claims," says Williams.

A contingency fee is usually a third of the payout. That number rises if the case goes to trial, but that's extremely rare. It's often cheaper for insurance companies to simply settle a claim rather than take it to trial.

How to find the right home insurance lawyer

Once you've determined that you need legal help, it's important to act fast. "Remember that insurance claims are riddled with technical defenses and loopholes," says Lazega. "Early legal guidance can help you avoid plummeting into them and can assist you in properly submitting the claim."

Insurance law is a specific field. You need a lawyer with insurance expertise if you want a good outcome. "Experience is critical," says Lazega. "Attorneys who focus their practice on challenging insurance companies know how to pick winning cases." There are a number of ways to find a qualified lawyer in your area.

  1. Find your state or county's lawyer referral service. If you're looking for a home insurance claim attorney near you, you can usually search a local database of barred lawyers by their specific areas of expertise. You can also use Avvo to get reviews on specific attorneys and read useful content.
  2. Ask for referrals. Every good lawyer will have past cases and clients that they can bring to the table. Look for past cases similar to yours and check if the lawyer got a good result.
  3. Get a free consultation. Once you've identified a few lawyers who might be able to handle your case, get in touch with them. Have all paperwork related to the claim with you. After a short conversation, they should know whether your case is worth fighting.
  4. Establish a payment arrangement. You'll most likely pay for legal help in one of two ways. First is an hourly fee, which may vary depending on the attorney's experience, location, and the firm. Second is a contingency fee, where the attorney will take a percentage of the recovered claim amount. That number is usually around 30%, though it rises if the case goes to trial.

Help with insurance claims: public adjuster vs. lawyer

A public adjuster offers many of the same services as a lawyer, but they can't file a lawsuit against the insurer. A lawyer can help you with the following:

1. A lawyer can take your case from start to finish. Public adjusters are very helpful in assessing whether you have a case. They can negotiate on your behalf with the insurance company. However, a public adjuster cannot file a lawsuit or represent the insured in a legal capacity.

If you hire a public adjuster and they attempt to negotiate a better claim outcome, you may need to get legal help if they're unsuccessful. "If this situation arises, the consumer will have to hire two professionals (the public adjuster and a lawyer) and will have to compensate both for their work on the claim," says Williams.

2. Lawyers with insurance experience are usually familiar with local public adjusters. Therefore, they can work hand in hand. That can save you the step of hiring a public adjuster and then needing to find a lawyer later.

3. Hiring a lawyer is a statement of intent to your insurance company. Your insurer will know that you are serious about fighting for your claim. It can also help expedite the claims process, as insurance companies rarely want to enter into lengthy and expensive litigation. "Sometimes the mere fact that you have hired an attorney will have the insurance company reconsider their denial to avoid litigation," says Simeone.

If you hired a homeowners insurance attorney and still didn't get a good result

If you hired a lawyer and still didn't get a good result, your last course of action is to file a complaint with your state's insurance commissioner. They oversee all insurance-related matters in your state. It's also possible that your denied claim or low settlement was legitimate. There's not much you can do if a judge rules that the insurance company made their decision in good faith.

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