Just Who Is To Blame?

By Author: Marcus Stalder
Total Articles: 491
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Sometimes, insurance is really simple. Your home stands in a line of properties hit by a tornado. The evidence of how your home came to be damaged is absolutely clear. The cost of rebuilding is up-to-date. You make the claim. The insurer pays. Your home is rebuilt. So let's sum up. If the terms of the policy are clear and the damage you suffered falls within that wording, the claims process is straightforward. But suppose things are not so clear. Let's say you go away for the weekend and, when you return, you find damage to the structure of your home. How did it happen? Remember, you can only claim if the wording of the policy includes damage caused in the ways listed. So was this storm damage or subsidence or was there a structural defect or had termites been eating away and your property just partly fell down? Well, now you're going to meet your insurance company's claims adjusters. These people travel round and debate with you how your home came to be damaged. Obviously, the insurer prefers not to pay unless it absolutely has to. So, before the adjuster arrives, read the policy to see what risks are covered and then collect ...
... evidence to show your damage was caused by a risk included in the policy. You can start off with a friendly discussion, but many homeowners have discovered it's sometimes necessary to move up from the push to the shove. Attorneys may be your best hope for getting a disputed claim settled.

Now let's get to another possible problem. Suppose you invite a local contractor into your home to repair some damaged wiring. The work seems to be done well but, overnight, there's a fire and the local investigator suggests the rewiring work was the source of the fire. Well, your contractor should be insured. Hmmm. So there may be two insurers facing a claim for the same damage. In theory, your own insurer should pay out quickly and then recover some or all of the money from the contractor's insurer. But as we all know, theory and practice are two different animals. So you should be prepared for delays. Actually, delay suits both insurers. The longer they hold all that premium income in their investment accounts, the more profit they make. So, again, you may have to be prepared to push your own insurer to pay out. In this, watch out for how much your own insurer pays. If there's a gap between the amount paid and the amount you lost, you can recover the difference from the contractor. Yes, that's twice the trouble but that's how the system works.

So when you are looking through your existing home insurance policy, you should always look at the way the different risks are defined. Most policies, even the cheap home insurance coverage, gives you protection against third party risks. But you should always have some idea who to claim from and whether this changes if there's someone else at fault. To protect yourself if a claim is going too slowly, you should always be prepared to ask for legal advice. Always protect yourself.