​​Does Your Insurance Policy Cover Everything You Think It Does?

When was the last time you read through your insurance policy? If you’re like most people, the answer might be “never.” Many policyholders believe their insurance covers every loss they might suffer, until they file a claim and discover gaps in their coverage. Understanding exactly what your policy covers can save you stress, protect your finances, and prevent costly misunderstandings. At Anspach Law Office, we believe that knowledge is power, and it’s important for our clients to be informed about their insurance coverage.

Decoding Your Insurance Policy

Insurance policies are dense, packed with legal jargon, and often misunderstood. To truly understand what your policy covers, focus on these key areas:

• Declarations Page: This first section outlines your coverage limits, deductibles, and the types of protection included in your policy. Think of it as a summary of your coverage.
• Exclusions: Policies often include specific circumstances or events they won’t cover, such as acts of war, intentional damage, or floods in standard homeowner policies.
• Endorsements or Riders: Additional coverage options you may have added to address specific concerns (e.g., jewelry, artwork, or business equipment in your home).
• Obligations: Your insurer may require steps like notifying them promptly of a change in circumstances or damages to maintain eligibility for your claim.

Common Misconceptions and Pitfalls

Some of the most frequent misunderstandings include:

• Flood and Earthquake Insurance: These are usually excluded from standard policies and require separate coverage.
• Replacement Cost vs. Actual Cash Value: Replacement cost pays for new items, while actual cash value deducts for depreciation, leading to smaller payouts than expected.
• Coverage for “Wear and Tear”: Home insurance typically doesn’t cover gradual issues like aging roofs or plumbing problems caused by poor maintenance.
• Rented or Borrowed Items: Property you rent or borrow may fall outside of standard coverage unless specifically listed.
• Business Activities at Home: Running a home business typically requires separate business insurance.

If you’re unsure about any terms in your policy, don’t hesitate to consult a lawyer or ask your insurance agent for clarification.

What to Do When a Claim Is Denied

Unfortunately, many policyholders find themselves in a dispute when their insurance claim is denied, delayed, or undervalued. Here’s what you should do if this happens:

Understand the Reason for Denial:

Review the denial letter closely. Insurers are required to provide a written explanation for why a claim is denied. Common reasons include missing documentation or claims deemed outside the scope of the policy.

Request a Policy Review:

Compare the denial reason against your policy. Sometimes, insurance companies misinterpret coverage, either intentionally or unintentionally.

Gather Evidence:

Provide photos, receipts, or inspection reports to substantiate the validity of your claim. Keep a log of all communications with your insurer.

Appeal the Decision:

Many insurers offer an internal appeals process. Submit a detailed letter outlining why you believe your claim should be approved, backed by documentation.

Seek Legal Representation:

If your insurer continues to deny what you believe is a valid claim, it may signal bad faith practices. A skilled attorney who understands insurance disputes can help you take legal action and pursue the compensation you deserve.

Turning Anxiety Into Action

Insurance policies and claims can feel overwhelming, especially when you’re already dealing with unexpected losses. At Anspach Law Office, we advocate for policyholders. Whether your claim has been denied, delayed, or undervalued, we’re here to ensure your rights are protected. Don’t settle for less than what you’re owed. Schedule a consultation with our team today.