In Arkansas Insurance Department acknowledges that policyholders do not normally climb on roofs to inspect for damage Chip Merlin blogged about a May 4, 2020 bulletin issued by the Arkansas Department of Wind and Hail Insurance. Claims. 1
Bulletin of 4 May 2020 stated in part:
It has been noted by the Arkansas Insurance Department that Arkansas residents have been denied coverage under their homeowners' policy for damage caused by the risk of windstorms or hail. Many of these denials are due to the fact that the insured does not report damages within the period of time required by their insurance.
Due to the fact that it is often unreasonable to expect a homeowner to identify wind or hail damage within the time period specified in the policy, it is the department's position that a period of 365 days must be allowed from that date the insured discovers or should have discovered the damage from wind or hail.
Languages in policies that limit the time frame to 365 days will be interpreted as meaning that claims will be filed within 365 days after a reasonable person exercising ordinary care would have discovered the damage.
The Department also recognizes that there should be a definitive limitation of liability for such a claim and will consider claims made outside a period of five years as an unreasonable time for a policyholder to detect damage from windstorms or hail. Five years was determined by the department as a reasonable measure based on state legal restrictions for measures for breach of contract. Sheet code Ann. § 16-56-111.
On September 1, 2020, the Arkansas Insurance Division issued Bulletin Nos. 19a-2020, amending Bulletin May 4, 2020. 2 This new bulletin states in part:
Although a requirement in a insurance to claim wind or hail damage within 365 days of the loss may be reasonable in most cases, there are situations where the policyholder may not identify wind and hail damage within this time frame without any fault of his own. It is the department's position that an insurance company must recognize exceptions from good reasons to a deadline for claims in a policy for wind and hail claims.
Specifically, the department's position is that a wind and hail claim was reported later than 365 days after the loss date can be denied based on an insurance provision requiring a claim to be reported within such time, but that the policyholder must be given the opportunity to refute the denial by showing that there was good reason for the delay in the reporting.
The Department also acknowledges that there should be no definitive limitation on such claims and will consider refusal of claims reported more than 24 months after the due date to be reasonably denied under insurance regulations. . This time will be considered reasonable given the inherent difficulties of adjusting receivables for losses that occur years before a claim is made.
In Arkansas, a homeowner must still fulfill his insurance obligation. policy to report a loss in a timely manner. Nevertheless, this new bulletin provides guidance for determining what is reasonable in cases where a delayed notification is not due to the insured's fault. 3 The question of whether a delay in discovering the damage was reasonable or due to negligence on the part of the homeowner will remain a matter of fact subject to the specific case. 4
1 Arkansas Department of Insurance, Bulletin No. 19-2020, issued May 4, 2020, Windstorm and Hail Claims. Available at https://insurance.arkansas.gov/uploads/resource/documents/19-2020.pdf  2 Arkansas Department of Insurance, Bulletin Nos. 19A-2020, Issued September 1, 2020, Windstorm and Hail Requirements (amendment of bulletin 19-2020). Available at https://insurance.arkansas.gov/uploads/resource/documents/19a-2020.pdf  3 id.19459004]  4 id.19659019]