When you file an insurance claim for damages to your home, your insurer should investigate your claim immediately. Typically, an insurer would send their own claims adjuster to investigate your claim and then pay you based on the adjuster’s evaluation.
But what if you suspect that the investigation didn’t cover all the damages in your home? Can you sue your insurer for doing a “poor” examination of your claims?
What makes a “poor” insurance investigation?
There are some telltale signs that your insurer is doing a terrible job investigating your claims. They include:
- Slow response: Under South Dakota laws, your insurer must immediately acknowledge and act on your claims within 30 days of filing them. This includes investigating your claims. If your insurer isn’t going to send its adjuster, they should promptly inform you to hire a public adjuster to start the investigation.
- An unusually swift investigation: A swift response to a claim is also a bad sign. If it looks like your insurer wants to wrap up an investigation quickly without going into more details, beware.
- Conveniently selecting evidence: Your insurer might conveniently consider evidence supporting insurance claim denial while ignoring signs that you need coverage. For instance, your insurer might reason that your flooded basement resulted from a sewer backup – usually not covered by basic home insurance – but ignore signs that a leaky pipe caused the damage.
- Refusing to investigate: Your insurer must examine all your claims per your policy’s contract. If they refuse to investigate and quickly move to deny your claim, they’re acting in bad faith.
If your insurer does any of these things, they’re likely acting in bad faith and you can sue them.
When you buy an insurance policy, you and your insurer enter into a contract. Your carrier is bound by the agreement to communicate clearly with you, promptly settle your claims and explain in detail why a claim is being denied. Bad faith actions like botching a claim investigation violate this. You can file a lawsuit against your insurer if this happens to you. Your insurer might contest this lawsuit, so you should consider hiring an attorney. A legal professional with insurance law experience can help negotiate a settlement with your insurer or represent you if the dispute is taken to court.