Water Damage: Insurance Claim Denials May Be All Wet

Insurance is a contract-based risk-sharing business, and insurance companies often fight to avoid payment by alleging that the claims are fraudulent. While insurance fraud is a serious problem in this country, insurers use such accusations far too often to deny legitimate claims. For homeowners and businesses alike, securing sufficient coverage for water-related damage is one the major battlegrounds.

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Include natural disasters, leaking pipes, malfunctioning household appliances, overflowing septic tanks, clogged gutters, and bathtubs/showers/toilets in need of repair.

Water intrusion is a common occurrence.

We've all seen sagging ceiling tiles or water stains on ceilings caused by a leaky roof or a burst overhead pipe. However, repairing the roof or fixing the pipe may not sufficiently address the damage. In all probability, the ceiling sheetrock/drywall/plaster itself has been compromised and should be replaced. The wood joists to which the ceiling is attached and any attic insulation should also be carefully inspected and possibly replaced. What if the water got into the duct work? A building's HVAC system is very similar to a human's respiratory system and some serious health conditions can result from breathing in air contaminated by stagnant water. Major renovations (wood, tiles, paint, etc.) may be necessary to avoid a significant health hazard, yet few insurance companies will factor in these additional damages when they make a settlement offer.

Damage Inspections: Taking a Second Look

Policyholders also may suspect that their water loss claims were wrongfully adjusted because some adjusters are sent into the field without the tools necessary to fully investigate the loss. There are several nondestructive tools available for finding moisture hidden behind walls, roofs, ceilings, and floors, most notably electric capacitance (EC), infrared thermography (IR), and nuclear hydrogen detection (NHD). Without such a full inspection, secondary problems often develop because the water and moisture never get removed. There are numerous lawsuits nationwide involving flat roofing systems and synthetic stucco systems because these building techniques rarely give any visual clues as to their condition or the location of leaks.

Unforeseen Damage & Consequences for Businesses

Water intrusion can be especially devastating to a commercial policyholder, whose very existence may depend on its insurer paying promptly and comprehensively. The water itself can damage merchandise, equipment, and records, while repairs can negatively influence income, production, and the ability to fund payroll. There's never a good time for a business to close for repairs, and even just a few days can result in losses that are difficult to measure, such as the effect on customer loyalty, on key limited opportunities, and on industry-specific factors. Though some commercial properties have business interruption insurance, calculating the losses can be extremely complex. Moreover, if the adjuster's investigation is inadequate and additional damage surfaces later, closing temporarily for re-repairs can easily become a permanent situation.

Fight for the Insurance Settlement that You Deserve

If, after your damages are properly documented, your insurance company is still not willing to pay to restore your property to what it was before the damage, it's time to seek legal help. An insurance attorney can communicate with your insurer on your behalf, review your policy, determine if there are other sources of recovery (such as a negligent contractor or plumber), and file suit to enforce your rights.

If you have any questions about this topic, feel free to contact us by calling 305-643-3100 or filling out a free case evaluation form.

The information about past verdicts and settlements is based on the unique facts of each case. Every case is different, and future cases may not achieve the same or similar results. These amounts reflect the gross recovery (before attorneys’ fees and expenses are deducted).

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