Property insurance & the claim-it includes:-
Receiving a property insurance claim is never easy. It’s only natural that you would want to explore all your options before deciding on whether you should make a claim or not. Property insurance has been around for decades, but it is relatively new how it works and what it covers. Property insurance claims are expensive, with a considerable amount of money being spent on lawyers and litigation. This is why it is crucial to understand what circumstances would cause a property insurance claim and how to avoid them before an accident happens. For a legal claim to be made, there must be evidence of actual damage or loss. In the case of property insurance, the insurance company believes that when one of their customers has had a property destroyed by fire, for example, there is evidence in the form of photographs and receipts to back up this claim. The first property insurance claim was filed in 1852, and there were only two types of claims at that time: fire and theft.
The different types of insurance claims that are possible are listed below.
- Fire-related incidents
- Flooding
- Theft
- Accidental Damage
- Earthquake
- Animals/Accidents with animals
- Riots or civil disturbances
The circumstances that would lead to a property insurance claim include the following:
1) Damage caused by natural disasters such as an earthquake or fire
2) Damage caused by another person
3) Damage caused by the interior of the building, such as excessive water damage or vandalism
4) Unreasonable delay in repairing the damage
Circumstances that might lead to a policyholder’s claim being rejected:-
The circumstances, would a property insurance claim be rejected are mainly varied. This section discusses what circumstances would lead to an insurance claim being rejected. It includes reasons such as non-repairable damages or destruction of the property. The following are some other circumstances that might lead to a policyholder’s claim being rected:
1) Late claiming:-
Late claiming is one of the most common reasons for the property insurance claim. This happens when the claim period expires before the incident or damage. The subscriber’s policy won’t be rejected, and they’ll have to pay for it themselves.
One of the most common cases is when an insured person inadvertently causes damage to his or her own property, which will result in the insurance provider paying the policyholder for all damages.
2) Excluded condition on the policy:-
A property insurance policy generally covers a range of events, including accidental damage to the property. However, some conditions exclude a claim from insurance. For instance, if an earthquake damaged your home, your policy will not cover the damages you incurred in this case. On the other hand, if your house is damaged due to a fire or flood likely, you will still be able to file an insurance claim for damages incurred during this event. Damage caused by an excluded peril, such as vandalism on an apartment building that has been expressly excluded from coverage.
3) No payment for insurance premiums:-
A property insurance claim is a process that is initiated by the insured party of a property being damaged or destroyed, usually because of accidents. The insurance company of the insured party will have to agree with the claims before they can be compensated.
In some cases, a property insurance company might refuse to pay a claim because a premium has not been paid for a certain amount of time. In this case, there would be no payment from the insurance company and no compensation from the policyholder.
A property insurance claim is usually rejected in the following conditions:
a. When there is no payment for insurance premiums
b. When the property is owned by an owner who has died or left the property without paying the premium
4) Suspicious or false claim:-
A property insurance claim is usually made in the event of theft, fire, water damage, or any other cause of property damage. The insurance company will decide how to handle the claim based on what happened and whether or not it was fraudulent. For example, if a person were to make a suspicious claim without any evidence of financial loss from their home, the insurer would not payout.
5) No precautions after damage on the initial loss:-
In the event of property damage, some circumstances may have caused the injury. Moreover, there are also some circumstances in which an insurance claim is not automatically rejected.
There are several different situations that a property insurance claim may be rejected. A property insurance claim will be rejected if it meets one of the following criteria:
a) The insured has taken precautions to prevent damage from happening again
b) A licensed contractor declares that the property cannot be repaired and declares it as damaged
c) The loss was due to a burglary or vandalism
How to prevent a claim from being rejected?
4 circumstances can prevent a claim from being rejected:
1) The insured person does not have an address for the building
2) The property is abandoned, and no one is living in it anymore
3) A court order has been passed against someone who was listed as a co-tenant or a tenant on the policy
4) The property damage caused by natural disasters
Conclusion:-
The property insurance claim process is a complicated one, with many steps and much at stake. It is essential to take the time to understand this process and make sure that your insurance claim is handled as quickly as possible. The number of property insurance claims has increased in the past few decades. This is due to the increase in insurance companies and the demand for more coverage. This is a question that every person should ask themselves before purchasing a home, especially if it is their first one. This will be an issue that will continue to grow and will become more of a problem with the increase in new construction and homes being built on land less than 30 years old.