Insurance Rights

September is a good time to review your homeowners and fire insurance policy for proper coverage. It is important to understand the type of benefits and the full extent of your insurance policy coverage before the devastating loss from a fire or other disaster.

Homeowners pay premiums for home and fire insurance policies with the expectation that their losses from a fire will be paid by the insurance companies. The insurance companies are expected to cover a reasonable amount for the repairs to the home damaged by fire as well as the for the replacement of lost contents such as furniture appliances and clothing for additional living expenses if the homeowner are displaced from the home during the repair work.

If you suffer a fire loss, you should expect that the insurance company will act in a prompt, fair and equitable manner in handling the fire claim. In fact, there is legal protection for homeowners; it is a violation of the California Insurance Code for an insurance company to knowingly commit or perform “with such frequency as to indicate a general business practice of not attempting in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear.” (California State Insurance Code 790.03(h).)

Unfortunately, insurance companies do not always act accordingly during your time of loss and devastation. We’ve complied a list of often asked questions and guidelines to follow.

How soon does my insurance company have to accept or deny my claim?

According to the Fair Claims Settlement Practices Regulations, the insurer “shall immediately, but in no event more than forty (40) calendar days later, accept or deny the claim, in whole or in part.” (CCR 2695.7(b).)

What if my insurance company says that they need more time to investigate my claim?

If the insurance company needs additional time to complete its investigation, the insurance company is required “to give written notice of the need for additional time.” (CCR 2695.7(c)(1).)

The written notice must “specify any additional information the insurer requires in order to make a determination and state any continuing reasons for the insurer’s inability to make a determination.” (CCR 2695.7(c)(1).)

Does my insurance company have to keep me up to date on the status of my claim?

The insurer is required to continue to provide written notice every thirty (30) calendar days until a determination is made or notice of legal action is served. (CCR 2695.7(c)(1).)

Conclusion

It is important that you timely and fully comply with various requirements and deadlines to recover benefits from a fire loss claim. These requirements may vary depending on the language in your insurance policy. A failure to comply with these requirements could be fatal to your recovery under the policy.

Your insurance company must promptly acknowledge receipt of your claim. It also has an ongoing duty to keep you apprised of the status of your claim. Your insurance company must attempt to promptly and in good faith offer a reasonable and equitable settlement of your claim once liability has become reasonably clear. If your insurance company fails to comply with these statutory mandates, you should immediately consult with an attorney. There is a limited time frame for you to file suit against your insurance company. Your claims could be barred if a lawsuit is not timely filed.