A disturbing trend is on the rise across the U.S. — insurance carriers are delaying and undervaluing property damage repairs, leaving property owners in a bind.
Property Owners Report on Bad Faith Claims Practices
Featured on Fox News earlier this week, an Oklahoma woman experienced a catastrophic loss over a year ago, only to have her carrier drag their feet on restoring her property. On recorded calls with the insured they claimed that repairs were not authorized by “management”, and when she questioned her policy limits, they told her it wasn’t based on her policy. They finally approved her repairs, then once she got started with the work needed – they dropped her policy. Watch the Fox News story, here »
This is not an isolated case! In another troubling video, an Allstate field adjuster testified about the use of third-party appraisers—without industry knowledge—who are hired to undervalue repairs. These third-party appraisers have been called to assess damages, leading to repair estimates that don’t reflect the true value of restoring properties to their pre-loss condition.
Watch his testimony here »
This local business owner reported on his property damage experience, “Years ago we had [Major National Carrier]. We had a roof leak at our business. They sent out their appraiser. We had a hidden camera on the roof and it caught him taking an empty caulking tube and shoving it into the downspout. Shortly after we got a notice that our claim was being denied because our downspout was plugged by a caulking tube. They even sent the appraiser’s picture. I responded with a clip from the video clearly showing what he did. I got my money in 48 hours. I’ve never used [Major National Carrier] again and I never would.”
Here’s another example of an undervalued loss, where this insured was forced to seek legal assistance with her property damages. Ms. Ladkin, an 85 year old retired school teacher, found water coming through her roof during a storm. The adjuster estimated to replace only 5 shingles and offered a settlement that amounted to $20 less than her deductible. (In court, the same adjuster quoted that it would take at least 15 shingles to properly repair the roof.) Ms. Ladkin then had an appraiser come out to assess the damages and the appraisal determined that the storm damage was upwards of $20,000. Her insurance carrier tried to pay only $2,700 of that $20,000 (13%)! Instead of paying fair compensation for this loss, the Carrier was taken to court by the insured and the jury awarded over $250,000 in damages, including $30,000 for repairs and interest and $125,000 for bad faith claim practices. $115,000 was also pre-approved in court should the carrier try to appeal at a later date. Review her district court case here »
Another local resident from Montgomery County filed suit against her carrier after accidental flooding to her property was undervalued. Her legal team from Chad T. Wilson Law Firm stated “ [The Carrier] assigned two of its adjusters to inspect the property and adjust the claim. The adjusters knowingly conducted a subpar investigation, refusing full coverage and estimating damages to total about $38,800. After the deductible, this left our client without the necessary recovery to make repairs to her home. The third-party expert hired after the insurance company’s negligent inspection found a litany of damages that were either conveniently absent or undervalued in [The Carrier’s] estimate.” They further explained that “[The Carrier’s] adjusters intentionally undervalued our client’s claims in order to maintain their jobs. They misrepresented the amount of damage in the hopes that our client would simply rely on their expertise and fraudulent estimate as a true representation of the property’s damages.” Read more here »
Another major national carrier found itself as part of a major U.S. Supreme Court hearing based on the handling of claims following Hurricane Katrina. The ruling found claims adjusters tried to deny valid claims by classifying wind damage as flood damage. Victims had to resort to whistle-blowing to hold the insurance company accountable for their actions.
The bottom line:
Insurance companies are legally required to return your property back to its pre-loss state, which means the same likeness and quality of building materials that were originally there must be restored post-loss. It’s time that insurance carriers follow the policy strictly and accurately, ensuring you get the repairs you need and deserve.
Disputes of $15,000.00 or less make it exceedingly hard to find legal support, and insurance carriers know this. We’re noticing that major carriers will purposely short pay on a smaller claim because the amount is equal to or less than the amount it takes to hire legal help in recovering it.
Learn how to advocate for your property loss:
Tri State Restorations recently released a three-part article series dedicated to educating our clientele on the importance of advocating for their claim. In Part 1, we explore how to protect your wallet and property when insurance companies try to undervalue your claim. Visit our website to read the full article: Protect your property & wallet.
At Tri State Restorations, we stand ready to help you navigate these challenges, ensuring your property is restored to its full, pre-loss condition. Don’t let insurance issues leave you in a bind—contact us today for the support and restoration you deserve.
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