Property Insurance: How to Understand the Details of Your Coverage

By Mario E. Lopez Esq. 

Homeowners purchase insurance coverage for their homes because of the security it provides from financial loss and damage to their investment. When an insured enters into an agreement with a property insurance company, both parties owe each other a duty to act in good faith and must deal fairly with one another. Because a homeowner’s insurance policy may or may not provide coverage for damage to an insureds property, it is important for all homeowners to analyze their policies because not all homeowners’ policies are created equal. In order to understand the different coverages available, it is important for homeowners to familiarize themselves with the basic provisions and exclusions found in most standard insurance policies. This is due to the fact that any coverage decision depends upon the precise policy language and the purported source of the damage. When a property insurance company denies a claim based on exclusions in the policy, the burden is on the insurance company to prove facts that bring the claim under the exclusion. When an insurer improperly rejects a homeowner’s claim under an insurance policy, the homeowner’s recourse is to file suit. The two main legal claims are for breach of contract and bad faith. In a breach of contract claim, the insurer typically responds by seeking a declaratory judgment that its policy exclusions are unambiguous and operate to deny coverage.

Most consumers may not be aware of this but in most states, insurers need to have each policy they plan to sell to consumers approved by the state before it is sold. Every state has its own regulations and coverage requirements depending on types of casualties and perils that are most common in the state. But generally, there are many items that are commonly found in most policies of insurance. For starters, there are 3 different types of insurance policies available to homeowners. The basic policy is called a HO-1 policy and covers eleven named perils. Most insurance agents recommend that a homeowner purchase a HO-3 policy, which covers all risks of loss except those specifically excluded. HO-3 policies cover damage to the residence (defined as a “dwelling”), “structures on the residence property,” and, subject to certain limits, personal property. For instance, a HO-3 policy will usually provide coverage for physical loss to the property caused by “windstorm. Each policy provides coverage against specified perils or events that cause damage to property. A broad form HO-2 policy is a type of home insurance that is written on a named-perils basis. This means it only covers damage to your property that’s caused by one of the perils listed on the policy. Most HO-2 policies cover damage due to fire or lightning, removal of property endangered by peril, windstorm or hail, vandalism or malicious mischief, theft, damage from vehicles and aircraft, explosion, riot or civil commotion, glass breakage and comprehensive liability. Special Form (HO-3) is the most popular and most comprehensive homeowners’ form of the three forms mentioned above. It covers the home for all causes of loss not specifically excluded or “all risks”.

Do You Need Help with Your Water Damage Property Insurance Claim?If you have additional questions about your insurance claim or are currently caught in an insurance dispute over damage to your property, contact us today at (305) 300-3000 for a free consultation. No one can predict when a disaster will strike, hence the reason why business owners and homeowners are so often ill-prepared for them when they do. Nor can you predict when your homeowner’s insurance company is going to deny a damage claim. The attorneys at Farrell, Patel, Jomarron & Lopez recognize your rights as an insured homeowner, understand how the insurance claims process works, and know how to submit a strong homeowners insurance claim that will prevent your water damage claim from being denied, delayed, or underpaid. Your home insurer will hire a team of attorneys who will work hard to make sure you don’t receive the compensation you are entitled to. You should have a team of lawyers working for you too! FPJL will aggressively represent you to ensure you get the money you are owed without any further delay by the insurance company. Our team of attorneys have decades of experience providing affordable representation to homeowners facing a wide range of denied, delayed or underpaid insurance claim issues.

Contact our law firm today at (305) 300-3000 for a free consultation!