Below is a conversation that I too often have with insured:
Insured: I just received a letter from the carrier that they deny my claim.
Lawyer: I'm sorry to hear that. What was the basis for the denial?
Insured: The basis for the denial was _____. But the insurance adjuster told me that this would be covered when he was on the property.
Lawyer: Good. Did you document the petition in writing?
Insured: . . . .
Everyone has heard stories of an insurance adjuster inspecting a property and giving insured insurances about the coverage they will receive, just to get a denial letter or a low ball estimate. In fact, for you in the Northeast, this was the scenario that started the fraud investigation of the engineers that FEMA used during Hurricane Sandy. 1
Although it is understandable for an insured person to rely on petitions made by an insurance adjuster at an inspection, those who have been around for a while should know better and document all kinds of favorable petitions made at an inspection. All that is required is an e-mail to the insurance adjuster with the following:
Thank you for meeting me out on the property today. As you may recall, during our inspection we discussed ______ and you stated ______.
If any of the above is incorrect, please let me know.
A simple email as above is very welcome for a lawyer representing a policyholder, especially if there are allegations of bad faith. It should come as no surprise that when a policyholder's attorney can attach documented misrepresentations to a complaint of bad faith, the case tends to resolve itself rather than later.
An insured or their representative should also document anyone and names inspecting the property of an insurance company. There are times when a carrier sends someone out to the property and the insured is never heard from them again or a report is never generated. Chances are that the person who inspected the property did not agree with the carrier's position.
Sometimes, in cases where a case reaches disputes, these inspectors may get lost by chance and not be mentioned in a carrier's witness list. And if the insured or his representative never documented the inspector on the property or informed the policyholder's attorney about the inspection, the attorney may miss the chance to ask the inspector and potentially evoke testimony that the inspector did not agree with the carrier's position.
Something I have learned through the judiciary is sometimes evidence that is not presented at trial and that a jury shows why it is not presented is as important as the evidence presented. In the above scenario, I can think of no better evidence to weigh against a carrier than to potentially show that an inspector – whom they employed – did not agree with his position and did not present a report or tell the insured.
Much as a policyholder's attorney should prepare any case that will be tried, a homeowner's representative should prepare his or her claim as it comes to trial.
1 60 minutes. FEMA: Evidence of Hurricane Sandy reports . February 27, 2017. https://www.cbsnews.com/news/fema-evidence-of-fraud-in-hurricane-sandy-reports/