Hurricane season can leave homeowners with significant damage, but insurance companies do not always act in good faith when processing claims. Insurers are required to handle claims promptly and fairly.
However, some companies use bad faith tactics to deny or delay hurricane insurance claims, making it difficult for policyholders to get the compensation they deserve.
Delaying claim investigations
One common bad-faith tactic is delaying the investigation of claims. Insurance companies may take longer than necessary to send an adjuster or request excessive documentation. In Louisiana, insurers must start investigating claims within 14 days after receiving proof of loss. When companies delay this process, they can leave homeowners struggling without the funds needed to make repairs.
Lowballing settlement offers
Another tactic involves offering settlements that are far below what a policyholder needs to cover the damages. Insurers may downplay the extent of damage or deny certain parts of the claim altogether. Louisiana law protects policyholders from unfair settlements, requiring insurers to pay claims equitably. Lowball offers can force homeowners into accepting far less than they deserve just to move forward.
Misinterpreting policy language
Insurance companies also use vague policy language to deny valid claims. By misinterpreting exclusions or confusing homeowners with technical terms, they aim to avoid paying out. Insurers must clarify policy terms and provide fair interpretations. A denial may be in bad faith if based on unclear policy wording.
Requesting unnecessary documentation
Another way insurers try to deny claims is by asking for unnecessary documentation. This tactic makes the process frustrating and can lead to delays or even missed deadlines. Louisiana requires insurers to only request relevant information needed to evaluate the claim.
Holding insurers accountable
Homeowners who face bad faith tactics should not accept unfair treatment. There are remedies for policyholders whose claims are wrongfully delayed or denied.