We’ve all seen the television ads. An attorney speaking to the camera tells the public, “Don’t talk to the insurance company adjuster! Don’t make any statement! Call an attorney!” Public adjusters tell claimants the same thing. Why? Are all insurance companies out to cheat their customers? If so, how do they survive selling insurance year after year and why in the world would anyone buy a policy from a company that cheats on its claims?
Understand that practicing law is a business. Attorneys want to make money, just like any other businessman. It is in the attorney or public adjuster’s best interest to convince the public that policy holders cannot trust insurance companies.
The real underlying problem is that insurance policies are hard-to-understand contracts. That’s right! Insurance policies are contracts. All those paragraphs and provisions that policy-holders never read…each is part of the contract and governs what will be paid, what will be denied and who or what is covered.
Since policy-holders don’t pay much attention to what the policy actually states, they are often out-raged when a claims adjuster denies a claim. “I thought I was buying full coverage” the surprised home-owner cries. When the adjuster points to the contract that EXCLUDES coverage for the claim, they immediately think they are being cheated.
Many homeowners damaged in Katrina were shocked to find out that flood is not covered by homeowner’s insurance. Now it doesn’t take a rocket-scientist to figure out that if you are living below sea-level in New Orleans, you may want to be sure that you are covered for flood. When the policy-holders in New Orleans were denied coverage for flood as the policies stated, they hired a lawyer to sue. The lawyer was creative. He tried to redefine the definition of flood, claiming that it was the failure of the levees that caused the damage to the homes, not the wall of water that was released.
The court ultimately disagreed finding that flood is commonly understood to mean ‘flood’…damage by water in simple terms.
It is in the best interests of the insurance company to have a satisfied claimant. It is in the best interest of any business to have satisfied customers. That bodes well for the future of the company. But it is not in the best interest of a company to pay claims that are not covered by the policy, or to pay too much for a claim. Insurance companies want to pay the least reasonable amount they can for a claim, and it is up to the claimant to prove what the claim is worth…not the adjuster.
Bottom line is, you have to be your own advocate. Read your insurance policy. Ask questions about items you don’t understand. Make sure you have the coverage you need and want. After a loss, it is too late!