Top Reasons Your Insurance Company May Deny Your Fire Claim

10/22/2018 (Permalink)

A home insurance policy typically covers numerous situations, including fire damage. However, there are two home fire circumstances that are usually not covered under most policies: arson and a fire inside a vacant home.

Investigating for Arson

Deliberately setting fire to a home is a criminal act, and a desire to collect insurance money is often the motive. For this reason, insurance companies require a fire investigation as part of the claim process. This helps the insurer establish the cause of the fire and note potentially suspicious details, such as multiple points of origin.

To help further reduce the risk of insurance fraud, your insurance company may also evaluate your personal finance and insurance claim history. Examples of potentially suspicious findings that may result in a denial of a home fire claim include the following:

• A recent increase in coverage or decrease in deductible
• Extensive debt or pending bankruptcy
• Prior insurance claims and loss history
• Recently purchased, high-value items on claim list
• The value of destroyed contents is inconsistent with household income

Because of this detailed investigation, any homeowner filing a claim in Mission Hills,KS, should be prepared for a potentially lengthy claim process.

A Vacant Home Fire

Like arson, a vacant home fire is also not typically covered under most insurance policies. A home is considered vacant if it is uninhabited for 30 or more consecutive days. If your insurance company can verify this circumstance, it may deny your claim, forcing you to fund cleanup and restoration costs out-of-pocket. To protect your financial interests, you should consider purchasing vacant home insurance or add an endorsement to your existing policy for any vacation homes or rental property you own.

Protecting Financial Interests

Your home insurance policy can be a strong financial safety net in the event of a home fire. However, because arson and insurance fraud are serious problems, insurance companies must thoroughly investigate fire claims to protect their financial interests. To further safeguard your financial security, you should update your policy to ensure vacation and rental properties are adequately protected.