Dealing with an insurance claim after property damage can be stressful, and receiving a claim estimate that seems too low only adds to the frustration, especially in today’s economic environment, where inflation continues to pinch at us from all sides.
Growing evidence shows that poor claims experiences, including potentially underestimated claim values, can have financial consequences for insurers and policyholders. A 2022 report by Accenture found that up to $170 billion in insurance premiums could be at risk over the next five years due to poor claims experiences. The study noted that nearly 30% of dissatisfied claimants had switched carriers in the past two years, and another 47% considered doing so.
You have options if you believe your insurance provider’s estimate does not fully cover your losses. Here’s a checklist of the steps we take to help our customers when they are unsatisfied with a claim estimate.
- Review the Estimate Carefully
Before taking any action, thoroughly review your insurance company’s estimate. Ensure you understand the breakdown of costs, what is covered, and any exclusions. Compare this to your policy details to see if anything appears to be missing or miscalculated.
- Check Your Insurance Policy
Refer to your insurance policy to confirm your coverage limits, deductibles, and any specific exclusions. Understanding your policy will help you make a strong case if you elect to dispute an estimate.
Sometimes, it can be confusing to understand this. Our staff is on standby to help you decode your policy clearly, and we can help confirm coverage limits, deductibles, and any specific exclusions.
In South Carolina, policies may include unique clauses related to hurricane deductibles, flood insurance requirements, and windstorm coverage. Be sure to review any state-specific provisions that could impact your claim.
- Gather Supporting Evidence
If you believe the estimate is too low, evidence will be critical to support your claim. Capture and file these items:
- Photos or videos of the damage before repairs
- Receipts for past repairs or improvements
- Independent contractor estimates
- Reports from inspectors or specialists
Having thorough documentation strengthens your argument when negotiating with your insurance provider.
- Get a Second Opinion
Insurance adjusters may not always provide the most accurate estimate. Consider hiring an independent contractor, public adjuster, or restoration specialist to assess the damage and provide an estimate. When disputing the insurer’s estimate, a second opinion can be a valuable comparison.
We’ve worked with a handful of dependable vendors that provide these services. Call us today, and we will share a few references.
- Communicate with Your Insurance Adjuster
Calling your insurance adjuster sounds like a pain, but you would be surprised by how helpful it can be to get clarification on how they arrived at the estimate. We’ve seen instances where simple errors or missing details can be resolved quickly through direct communication.
But remember, when discussing discrepancies, be polite but firm.
- Request a Reassessment
If you have new evidence or an independent estimate that supports a higher claim amount, formally request a reassessment from your insurance company. Many insurers have processes for reevaluating claims if the policyholder can proactively provide additional information.
Costs associated with rebuilding, renovating, materials, etc., can vary based on the market. This is where you can help your insurance company understand the market conditions in your neighborhood. Providing plenty of evidence will go a long way in confirming what’s fair.
- Consider Hiring a Public Adjuster
A public adjuster works on your behalf to assess the damage and negotiate with the insurance company. They have experience interpreting policies and ensuring policyholders receive fair settlements.
But remember that public adjusters charge a percentage of the claim payout, so weigh the costs and benefits.
- File an Appeal with Your Insurance Provider
This is different than filing for a reassessment. Most insurance companies have an appeals process for claim disputes. Follow your insurer’s procedures, submit all necessary documentation, and keep records of all correspondence.
- Consult a Legal Professional
If your dispute remains unresolved and you believe your insurer is acting in bad faith, consider consulting an attorney who specializes in insurance claims. We receive many inquiries about this topic, and the anticipated outcome depends on the situation’s specifics.
An attorney can advise you on your legal options and whether further action is warranted. In South Carolina, you may also contact the South Carolina Department of Insurance for guidance on consumer rights and dispute resolution.
Bad faith insurance claims have been on the rise in recent years. A report by Marsh indicates a sharp increase in such claims against insurance companies between 2020 and October 2024. Data from Reed Smith LLP highlights heightened scrutiny of insurers’ handling of claims in 2022 and 2023, a pattern expected to continue in today’s economic climate.
- Explore Alternative Dispute Resolution
Some states offer mediation or appraisal programs to resolve claim disputes between policyholders and insurers. In South Carolina, the Department of Insurance provides a mediation program that can help resolve disputes between homeowners and insurance providers.
The South Carolina Bar Association might offer legal resources or alternative dispute resolution services. Contact these organizations to explore your options for resolving your claim.
Final Thoughts
Receiving a low claim estimate can be frustrating, but taking the proper steps can improve your chances of getting a fair settlement.
Stay organized, be persistent, and leverage expert opinions when necessary.
Don’t hesitate to contact an expert like us if you need assistance. We are here to help ensure you receive the compensation you deserve.