Handling Undervalued or Denied Insurance Claims

Life in California can come with a lot of risk, ranging from natural disasters including fires, earthquakes, and mudslides, to unnatural disasters like higher likelihood of car accidents. But even those equipped with the protection of insurance may not be entirely safe as insurance companies often undervalue or even deny claims, leaving the victims of property or physical damage financially responsible for their own repairs and medical bills.

While the practice of undervaluing insurance claims may not be intentional, determining the cost to repair damage is not as straightforward as it would seem. When surveying damage, appraisers often don’t spend the necessary time evaluating each case and can feasibly overlook key components such as material costs, labor, building-code requirements, or damage that may be uncovered later.

In addition to not adequately recognizing certain costs, it’s in the insurance company’s best interest to operate in ways that keep their expenses as low as possible. This means the appraiser is more likely to undercut the claim estimate in the insurer’s favor in order to leave room for monetary negotiation (or in hopes that the estimate will be accepted unconditionally by the claim filer).

These instances are even more apparent when there is a large influx of claims. When the insurance company doesn’t have enough appraisers at their disposal, they hire freelance appraisers (usually referred to as storm troopers) to investigate the claims. And since these private contractors generally have less time to evaluate each case, short cuts are even more prevalent than usual, negatively affecting the final number of your settlement.

The problem with this, however, is that these settlements are accepted more often than not. Since the process of evaluation can take a great deal of time, the accumulation of bills can often cloud the judgement of those considering the initial offering. And given that most aren’t aware of the exorbitant costs coming their way (nor do they believe their insurance company is low-balling them), the the immediate need for funds can pressure those into accepting an unfair sum. By accepting this settlement, filers can no longer seek additional compensation from their insurer at a later date when the actual repair costs are revealed, effectively ruining their chances of receiving an adequately evaluated reimbursement and forcing the individual to pay out of pocket.

Experienced lawyers know what to look for regarding insurance claims and appraisals, therefore it’s wise to contact a lawyer in the event you find yourself filing a claim. With insurance companies being fitted with multiple lawyers themselves, it’s only fair that you also have legal representation at your side to ensure you receive what’s rightfully due to you. If you or a loved one has received an undervalued claim or your claim was outright denied by your insurance provider, contact Legal One Law Group at (818) 480-6732 to schedule a free consultation regarding your legal options.