Timing is crucial when recovering from a natural disaster that damages part of your home. You want repairs to your home completed before the next severe weather event hits. While you’re free to have home repair crews fix your property as soon as a disaster passes, your insurance carrier may not be as quick to respond to your claims.
Why do insurers delay?
One of the top reasons why insurers delay processing claims is because they’re trying to make as much revenue as possible. Insurers put the premiums they collect from their customers into investment accounts to generate interest, and the longer it sits untouched, the more they can earn.
But there are other reasons for delays, such as:
- They can’t pay: If a significant disaster, such as a wildfire or flooding, damages multiple homes in an area, you can expect your insurer to be neck-deep in claims. It might take some time to pay all policyholders affected, either because there are too many to handle all at once, or your insurer lacks the cash.
- Delayed communications: Even if an adjuster manages to assess your home for damages early in the claims process, there could be issues with communicating the information to the insurer on time.
- Outstanding disputes: Your insurer can dispute your claim, delaying payment. They might disagree with the extent of the damages you claim or argue that your claim falls under their policy exclusions.
- They’re still deciding whether to cover: In California, your insurer must accept or deny your claim within 40 calendar days from the time you send proof of your claim. It also must conclude its investigation within that timeframe and inform you of its decision.
How long should I wait for my insurer?
If an insurer needs more time to decide on your claim, it must inform you within 40 days. The insurer must also explain any additional information required to determine definitively.
But after the first 45 days and the insurer continues to delay, it’s required by state law to continue giving you written notice every 30 days until it reaches a decision.
Realistically, this can be too long for the average homeowner.
When can I sue my insurer for taking too long?
If your insurer takes too long to process your claim, your first option is to file an official complaint with the California Department of Insurance. But if your insurer appears to be purposefully delaying your claim – such as requiring multiple but redundant claim reports – you might want to hire a legal professional knowledgeable in insurance law. You may be able to hold your insurer accountable through a bad-faith lawsuit, and a lawyer can help settle the dispute.
