When you file a property insurance claim, you expect your insurance company to give you the money you need to aid in your recovery. Though some insurance companies respond in a timely manner and issue settlements in just a few weeks, others may drag their feet. Letting an experienced Michigan property insurance claims attorney represent your case may help you get a settlement faster. However, it’s a good idea to understand why insurance companies drag out settlements so you can better figure out your next move.
The Acceptable Reasons
Though any delay in receiving an insurance settlement can be frustrating, insurance companies often have good reasons for delaying your settlement check. Here are some of the neutral or even acceptable reasons why you may have to wait to get your money.
To Investigate Your Claim
Insurance providers need to investigate your claim, confirming the details, the damage, and the estimated cost of repairs or replacement before they can issue you a check. In theory, and with insurance companies who truly want to help their customers, this process ensures that the settlement is fair and adequately helps cover any costs related to the damage.
To Respond to Your Appeal
If you think the settlement amount is too low or doesn’t align with repair quotes you’ve received from local contractors, you can appeal the decision. This can create a delay in your settlement check, making it seem like the insurance company is needlessly dragging their feet. But it’s all part of the review process. The insurance provider must reevaluate your claim, the evidence you submitted, and the policy’s coverage limits to reassess your settlement amount. This can take time, but they’ll typically reach a decision as quickly as they can.
The Unacceptable Reasons
Though some insurance companies always act in good faith and do what they can to help you get the money you need quickly, others drag their feet for selfish reasons. This includes but isn’t limited to the following.
To Increase Their Profits
The lower your settlement amount is, the higher the insurance company’s profits will be. By dragging their feet, some insurance providers may hope that the delay just makes you more desperate for any settlement amount they offer. They hope you’ll accept the check even if the amount is lower than you deserve. This helps keep their total annual payouts lower and their profits higher. And the more money they keep in their pockets, the happier their board of directors, senior leadership team, and shareholders will be.
To Secure a Lower Settlement Amount
Insurance companies may use delays as an excuse to further investigate your claim in the hopes of proving that you need a smaller settlement. They may work more closely with the insurance adjuster to determine the full extent of the damage and may request additional investigations in the hopes of identifying repairs you made prior to receiving the settlement to further decrease what they owe you.
Acting in Bad Faith
Insurance companies are contractually required to honor their insurance policies for any policyholder who files a claim for damage covered under the policy. When an insurance company denies a claim without a valid reason, intentionally interprets the policy’s coverage details incorrectly, or values the damage done at rates lower than what industry professionals would consider acceptable, they’re acting in bad faith. These actions are typically done in an attempt to save money by dragging out settlements and encouraging policyholders and homeowners to give up and pay for repairs out of pocket.
Work With a Michigan Property Insurance Claims Attorney
As a property owner, you’re entitled to settlements for damage that’s covered under your insurance policy. If you suspect that your insurance provider is dragging its feet or is trying to get you to accept a low-ball offer, don’t give up. Contact Fabian, Sklar, King & Liss today to schedule a free consultation with an experienced Michigan property insurance claims attorney.