When you purchase insurance, you do so with the understanding that the insurers will be there to offer the support you need when a qualifying incident occurs. You enter into a contract of paying premiums and expect the insurance company to adhere to the terms it has set out. That’s not always what happens, however.
Underpaid claims represent a serious issue that is unfortunately all too common. Instead of outright denying your claim, insurers choose to make low offers, banking on your desperation to receive help. You may not have the time or means to pursue an underpaid insurance claim and go through the appeals process, which is how insurers get away with this wrongful conduct.
That is when an underpaid insurance claims lawyer in Florida can help. The right team can fight for your rights and recover the benefits you paid for. At Kennon Law, our team of experienced underpaid claims lawyers can help hold insurance companies accountable if they’ve failed to pay you what you deserve.
Identifying Underpaid Claims
An underpaid claim is when the insurance payout is less than the agreed-upon or billed amount. It can result in you having to cover the rest out of pocket, leading to a serious financial burden. Insurance companies can make mistakes when processing claims, but they can also act in bad faith and underpay you on purpose.
There are a few common signs of underpaid insurance claims. The most obvious is if the insurer pays significantly less than the repair or replacement estimates you’ve received. Companies may also exclude certain damages without clearly explaining why, or there may be discrepancies between the policy terms and the actual payout.
The problem is that insurance contracts tend to be so complex and ambiguous that you may be uncertain of what the policy is actually stating. That confusion could lead you to hesitate in filing an appeal.
Underpaid claims can occur whenever you’re dealing with insurers, but they’re most common when they involve:
- Homeowner’s insurance
- Health insurance
- Property damage claims
- Business interruption insurance
- Auto insurance
In Florida, the risk of hurricanes means that your homeowner’s insurance is vital. Florida underpaid property damage claims are all too common, though. They leave people with homes severely damaged or destroyed by severe tropical storms and no way to afford the repair costs. Cars, too, can be totaled by fallen trees or floods, leaving you dependent on insurance payments.
The same can occur if you own a business and suffer losses because of a natural disaster. If you’ve faithfully paid business interruption insurance to protect yourself in these situations, you could face serious expenses if insurers don’t honor their side of the contract.
Working With the Insurance Company
The first step when dealing with insurance claim underpaid issues is to review your contract. Your insurance policy can provide numerous pieces of information that are critical to knowing whether you’ve received a fair payout or not. Policies can vary significantly from one insurance company to another, too, so never make assumptions about your coverage limits.
Have a clear idea of the policy’s exclusions and deductibles. A common mistake homeowners make, for example, is not checking whether their home insurance covers floods. Most policies don’t.
What to Do if You Suspect an Underpayment
If you’ve received a settlement offer that appears too low and doesn’t cover all the losses you’ve sustained, take time to carefully assess the paperwork, including your claim documentation. Then, contact your insurance adjuster. Begin keeping a record of all your communications with the company.
When you speak with the adjuster, point out the discrepancies that you’ve spotted and request clarification. Most of the time, the best option is to ask for a re-evaluation. The insurance company may request further documentation to verify parts of the claim.
Common Tactics Adjusters Use to Underpay Claims
A common tactic insurers use is low-ball offers. These offers are typically well below the true value of the claim and are meant to put pressure on policyholders who may not know their rights.
Often, insurance companies deliberately misinterpret policies. They could claim that the contract excludes certain damages when your policy actually covers them. Insurers could try to overwhelm and confuse you with legal jargon until you accept a low offer. Another strategy is to delay the process as long as possible. That can push policyholders who are in financial difficulties to accept a low settlement.
Seeking Professional Help
Appealing underpaid insurance claims isn’t a simple process. Once an insurer has made a decision, it can be tough to get it to re-evaluate. Is the company continuing to offer low settlements despite all the evidence you’ve provided, or have you noticed that the policy terms are vague enough to keep the insurer from paying you fully for a valid claim? If either is true in your case, you need representation.
You should also never attempt the underpayment claim process alone if you’ve sustained significant damages. These cases tend to be complex, and you deserve to give yourself the best chance to receive full payment for what you’ve lost.
Benefits of Hiring Experienced Legal Representation
When you hire a bad faith insurance lawyer, you know you have people helping you who will comply with all Florida insurance laws. At Kennon Law, we begin the process by fully assessing your case and your policy to be able to robustly represent you. Your lawyer will give you a clear idea of the damages you can claim, including any property and revenue loss you’ve sustained.
Lawyers can handle all of the negotiations with insurance companies. These negotiations can be contentious, and someone without a legal background won’t be able to successfully argue against a claims adjuster.
Vitally, having experienced representation offers the chance to pursue litigation if that’s the only way to recover the benefits insurers are denying or underpaying. Going to court is not something to attempt on your own.
The Claims Appeal Process
To appeal the insurance company’s decision, you must first understand why your claim has been denied or underpaid. Sometimes, communications from the claims adjuster will offer an explanation, but this isn’t always the case. If you suspect the company is acting in bad faith, you likely won’t know why you’ve been underpaid.
Whether you know the reason or not, the next step should be to gather documentation and other evidence that supports your claim. You can then write an appeal letter stating a formal wish to have your claim reassessed.
Your lawyer is extremely valuable during the appeals process. They can offer the guidance you need while ensuring that all of the legalities are taken care of. This can prevent further delays and outright refusals to consider a re-evaluation.
Florida typically requires that you file an appeal within 30 to 60 days of receiving the denial or low offer. Insurance companies must review and answer the claim rapidly, though the exact timeline can vary.
Strategies for Recovery
When filing an appeal for underpaid or denied claims, you can help yourself by having clear records of everything related to the losses you suffered. You must also have records of all your communications with the insurance company. For your appeal, it can help to obtain independent estimates or inspections so that insurers have an accurate idea of what they need to pay.
Above all, avoid accepting the first offer you receive. It will always be a low one meant to keep you from recovering what you need and deserve.
If possible, consider hiring a public adjuster. They assess the damage you’ve sustained in the same way an insurance adjuster would, but they work for you. Public adjusters can collaborate with lawyers to negotiate a payout that covers your losses. These two parties will share information to plan the right appeals strategy.
Litigation and Court Settlements
Litigation for underpaid insurance claims is an option you can choose if you’ve exhausted your appeals or if the insurer doesn’t want to cooperate. If there is evidence of bad faith, such as purposely delaying the claim or ignoring evidence, then it’s time to take the case to court.
With your lawyer, you can claim a breach of contract because insurance policies are legally binding. Sometimes, the threat of litigation is enough to get insurers back to the negotiation table, but not always. That’s when you can decide to file a lawsuit.
As with other types of court cases, there will be a period of discovery and evidence gathering. Both parties will exchange relevant information, and there may be a need to get expert appraisals of the damages you suffered. Mediation is available throughout the entire process, but if it’s impossible to reach a fair settlement, the case will go to trial. A jury will decide on the appropriate resolution.
Although the litigation process can be stressful and lengthier than you may prefer, it can actually offer numerous benefits. For one, you can recover all the losses you’re claiming. You can also receive punitive damages if the company acted in bad faith, which can mean substantial winnings.
Preventing Underpaid Claims in the Future
To avoid further car or homeowner’s insurance underpayment disputes in the future, ensure that you fully understand your insurance policy. You can always speak with an attorney about the details. It’s a good idea to run all these contracts by a lawyer before signing them to ensure the terms are standard. You’ll want to review the policies regularly and update them as needed.
Another way to prevent underpaid claims is by promptly letting insurance companies know when you experience losses. Be certain that you keep a thorough record of the damages, too. And before beginning any claim, consult with a professional. Hiring a lawyer to guide you through this process can save you lots of time and effort.
Get Help From a Florida Underpaid Insurance Claim Lawyer
Underpaid claims can leave you having to cover your losses out of your own pocket, which is downright impossible for many to do. By working with an underpaid insurance claim lawyer, you have a chance to negotiate with the insurance company and recover your full benefits.
If you’re struggling through problems with your insurer, the team at Kennon Law can help. We have years of experience assisting people throughout Florida in battling insurance underpayment problems. Contact our team to schedule a consultation.
Frequently Asked Questions
Why Do Insurance Companies Underpay Claims?
Insurance companies are businesses striving to maximize their profits. Minimizing payouts is one way they reach this goal.
Can I Sue if I’m Being Underpaid?
Yes. If you believe the insurer is acting in bad faith or that they breached their contract, you can file a lawsuit.
What Is the Difference Between Claim Denials and Claim Underpayments?
A claim denial means the insurer refuses to cover any of the losses you sustained, while a claim underpayment means the insurance company won’t cover all of your losses.
Can Underpayment of Claims Be Considered Insurance Bad Faith?
They can be, though sometimes underpayment is the result of faulty information, not enough evidence to support the claim, and a variety of other errors.
Is There a Time Limit for Disputing an Underpaid Insurance Claim?
You will typically have between 30 and 60 days to file an appeal.
What Steps Should I Take After Discovering My Claim Was Underpaid?
You should review your policy and the paperwork that explains why your claim was underpaid. Contact the insurer to understand what your options are, and hire a law firm to help you file an appeal.
Can I Dispute an Underpaid Claim, and What Is the Process?
Yes. You can file an appeal and present any additional evidence your insurer requires. If they still refuse to pay the full claim, you can file a lawsuit and go to court.
What Documents Are Needed to Challenge an Underpaid Claim?
You will need your original claim, evidence of all the damages you suffered, and estimates of the repair or replacement costs.
Are There Specific Types of Insurance Claims More Prone to Underpayment?
Homeowner’s insurance, health insurance, and auto insurance claims are more prone to being underpaid.
What Are Common Mistakes Policyholders Make That Lead to Underpaid Claims?
Not providing enough evidence of the losses, not filing the claim on time, and not fully understanding policy coverage are all common mistakes that can lead to underpaid claims.
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