Wildfire Insurance Claim Mistakes to Avoid

It only takes one change in the direction of the wind for homeowners near a wildfire to go from “We’re safe” to “We have to evacuate.” If the evacuation orders come in, you can do your best to load up the car with what is important.

After that, it becomes a waiting game before you can return to see if anything is left of your home.

Obviously, the worst-case scenario would be a total loss. However, a wildfire can also cause smoke damage to properties that were never touched by the flames. Whatever damage you might suffer in the wake of a wildfire, it is important that you file an immediate claim with your homeowner’s insurance carrier.

The sooner you get the claim process started, the quicker you can receive support for your damages.

Unfortunately, in your rush to get your insurance payout, you might make errors in your claim that can delay the reimbursement. In some cases, your errors might also trigger a denial.

Common Errors When Filing a Wildfire Damage Claim

Insurance companies have earned a reputation as businesses that only care about their bottom line. While they would much rather avoid paying a claim, they are still obligated to honor the policy. That doesn’t mean they won’t look for an error that allows them to deny the claim.

These are the common errors that you need to avoid when filing your wildfire damage claim:

Delayed Reporting

You might not have noticed, but there is a good chance your insurance policy has a “prompt notice” clause.

This is a requirement for you to report any damage to your property immediately. That does not mean you’ll be filing a claim for damages; it just means the event happened. Without a prompt notice, the insurance company is likely to deny the claim.

Inadequate Documentation

Every homeowner should document their property with a “before” video. This would be a slow walkthrough of the entire house, including valuable assets such as furnishings, electronics, art, and jewelry. If the home was damaged in a wildfire, you should provide an “after” video that goes over the same area and items. This needs to happen before any cleanup starts.

Throwing Away Damaged Items

In an effort to clear your home, you might be eager to throw out damaged items.

However, you need to give the assigned adjuster a chance to inspect the damaged item in order to prove your loss. There are too many instances of unscrupulous people trying to defraud insurance companies.

Overlooking Smoke Damage

Damage from a wildfire is not always visible. Your property could have suffered soot or smoke damage. These are the kinds of things that won’t go away and require deep remediation. That should be covered in your insurance policy.

It is important that you file the initial claim as accurately as possible to avoid any denial.

The Danger of Underestimating Your Property Losses

You don’t want to wait until your home has been damaged in a wildfire to find out you undervalued its worth. Sadly, that is a problem many property owners face.

When you bought your home, you also started your homeowner’s policy, which was aligned with the property’s value. In the ensuing years, the property’s value might have increased. Realistically, your insurance policy should reflect the current value.

If your claim exceeds the policy limit because you underestimated the value, you would be responsible for the out-of-pocket expenses.

One way to avoid the danger of underestimating the value of your property is to bring in an independent appraiser to evaluate your property.

Why You Must Document Every Communication with Your Insurer

Even if you have been a policyholder for several years, when you file a claim, the insurance company will not accept your word for it. You have to provide the necessary documentation to support the claim.

When you create a document, it creates accountability. That pertains to any email chain. Those should all be saved in a separate folder. That documentation also ensures accuracy when you can list dates, times, places, and any contact with adjusters.

Here’s what you need to document or keep a record of:

  • All phone calls
  • Emails
  • Letters
  • Receipts
  • Estimates
  • Texts

Every piece of documentation you can provide is another piece of evidence supporting your claim and expediting the payout.

Accepting a Quick Settlement Offer Too Early

After filing your claim, you might be presented with a quick settlement. That could be presented as a lump-sum payment, which appears sufficient. However, upon closer inspection, you might discover that fast settlement is significantly lower than the value of your damaged properties. That’s not the only concern.

Once you accept an offer, you will be asked to sign a waiver. This is an irreversible waiver. That means if you accept the settlement and later realize you should have gotten more money, you can’t go back and refile your claim.

The better approach before accepting an offer is to speak with a Reno wildfire insurance lawyer and have them review your losses, your policy, and what the offer might be.

Signs Your Insurance Company Is Acting in Bad Faith

There can be a lot of frustration associated with an insurance claim, especially if it involves replacing your entire home. Unfortunately, there could be a situation where your insurance company is acting in bad faith. These are the signs to watch out for:

  • Unreasonable delays
  • No explanation for the denial
  • Lowball settlement offers
  • Misrepresenting policy terms
  • Failure to investigate
  • Refusal to communicate
  • Extensive documentation requests

If you experience any of those red flags, you should speak with an attorney to discuss your options.

Frequently Asked Questions About Wildfire Insurance Claims

What should I do if my insurance company denies my wildfire claim?

If your claim is denied, request a written explanation citing the specific policy language used for the decision. You should then gather all documentation, including photos and independent repair estimates, and consult an insurance bad faith attorney to review your options for an appeal or legal action.

Can I claim smoke damage even if the fire did not reach my home?

Yes, most homeowners’ policies cover smoke, soot, and ash damage regardless of whether the flames touched the structure. Smoke can cause significant hidden damage to HVAC systems, insulation, and personal belongings that require professional cleaning or replacement.

How do I know if my insurance company is lowballing me?

You may be receiving a lowball offer if the settlement amount is significantly lower than independent contractor bids or if the adjuster ignores specific items in your inventory. Insurance companies often use depreciated ‘actual cash value’ instead of ‘replacement cost’ to save money, which may violate your policy terms.

What is the deadline for filing a wildfire claim in Nevada?

In Nevada, the statute of limitations for breach of contract is generally six years, but most insurance policies have much shorter ‘suit against us’ clauses, often one or two years. It is vital to review your specific policy and contact an attorney immediately to ensure you do not miss critical filing deadlines.

How an Insurance Bad Faith Attorney Can Help

When an insurance company acts in bad faith, it can have a direct impact on your ability to take care of your losses and move on. An insurance bad-faith attorney can step in and become your advocate to investigate any misconduct. The Law Office of Matthew L. Sharp has helped many Reno residents stand up to insurance companies that aren’t fulfilling their obligations to their policyholders.

The basic thing that we can help with is to take over the communications. It has been our experience that insurance companies tend to respond more quickly when an attorney is making a request for answers.

If the insurance company insists that their lowball effort is “the best they can do,” we might not accept that. In that case, we could recommend filing a civil complaint. That will mean gathering all your documentation and evidence and presenting it to a jury. This is an option we would only suggest if we were confident that we would prevail.

Our mission is to support the best interests of our clients. If you’re having problems with your wildfire claim, we want to hear from you. Call to set up a free case review today.

Don’t let the insurance company attempt to steamroll you.