How to Make Sure Your Home Insurance Claims Aren’t Rejected
Spending money on insurance is no fun, but what’s worse is when your claims get rejected. It can feel like you are paying a monthly premium but not getting anything in return. To make the most of your home insurance, you can follow the below steps and ensure your claims go through.
Many people view insurance as a grudge purchase. Even though many of us don’t enjoy having to pay monthly premiums, we do enjoy the cover we get in return. Knowing we can face the worst if it comes can give homeowners peace of mind.
Unfortunately, only a small percentage of people read through the fine print in their contents insurance contracts. In some instances, it is only when they need to submit a claim that they learn about a missed clause that they have not followed. We’re here to help you ensure your home insurance claims don’t get rejected.
What to Do When You Are Not Happy with a Claim Rejection
Yes, your home insurance claim can get rejected by the insurer, and sometimes they have good, or at least legal, reasons. When a claim gets rejected, the insured often feels cheated and unsatisfied. It’s good to know you have a legal right to approach an arbitrator and request further reasons when you aren’t happy with the outcome of a claim. You can also go to the Ombudsman for Short Term Insurance to oppose the rejection.
Why Was My Home Insurance Claim Rejected?
Many times the reasons why your claim has been rejected are already in your policy. For example, landslides may be listed as an exclusion in your policy. If your buildings insurance doesn’t pay out for it, it will be because it is listed as an exclusion. No mediation can change the exclusion.
Sometimes, the insured fails to comply with terms and conditions. For example, most insurers require that due maintenance be performed on your building. If you have a leak in your roof that is due to a lack of maintenance, the insurer won’t pay out.
Sometimes, there may be a simple administrative problem or fallacy in the claims process. Maybe you forgot to fill in a specific form or tick a specific box. Not all cases are clear-cut, however, and you can get an independent evaluator to give a second opinion or take the matter further with the ombudsman if you are still dissatisfied.
9 Steps to Ensuring Your Home Insurance Claim Isn’t Rejected
1. Always Pay Premiums On Time
The insurance company cannot cover you if you do not pay your monthly premiums on time. Did you know that they will immediately cancel your policy if you place a stop-order on your short-term insurance debit order? This is because your intention was to not pay them.
Similarly, if your check bounces or your order returns due to lack of funds in your account, they can also refuse to pay your claims. South African legislation requires you to pay the outstanding amount before they can pay out any claims. If you happen to claim during a period when your account is in the red with the insurer, chances are your claim will get rejected.
To avoid this situation, it is important to ensure you have the money to pay your premiums each month.
2. Always Disclose All Relevant Information (Avoid Non-Disclosure)
Non-disclosure is a big no-no in the insurance industry. Insurers cannot cover insured events listed in your policy if you have not disclosed all the facts. These can include your official address, the list of assets covered and their true values, or even a change in tenants.
If your property is standing vacant because you or your tenant have moved out, it is important to let the insurance company know. This change exposes your property to unique risks, and if you do not inform the insurer, they may reject your claim.
This is because the cover they offer is based on the risk profile they assess based on the information you provide. When the information is inaccurate, the cover is jeopardised. You can update your policy details from time to time to ensure they have all the up-to-date information need to provide you with adequate cover.
3. Report Incidents Timeously (Avoid Late Notification)
Your insurance policy may stipulate a timeframe within which you must report an incident. The time period depends on the type of claim. For example, if your roof sustains damage due to a storm, they may require you to report it within 30 days. If a car drives into your building, however, you may be required to report it within 48 hours.
When an insured event occurs, it’s best to report it immediately or as soon afterwards as possible.
4. Only Insure Items or Assets You Have an Insurable Interest In
Did you know that you cannot insure an asset you have no insurable interest in? That means if you are insuring your mother’s house, which is registered in her name, and you do not inform the insurer of this insurable interest, they may reject your claim. The rights and interests of all parties must be noted in the policy.
5. Do Routine Maintenance for Wear and Tear
Most home building insurance policies don’t cover wear and tear. That means if you claim for something, and the insurance company can see you did not duly maintain the damaged area in your home for wear and tear, they can reject your claim. A great example would be a leak in the roof. If it is clear that the leak has been happening for a while, and there is mould or water damage, the insurer can rightly say you have not been maintaining your roof and can deny your claim.
If your house burns down, however, the resulting fire damage is instant and does not relate to wear and tear. Other terms and conditions may influence whether such a claim is paid out, such as any evidence for malicious intent or fraud.
6. Do General Property Maintenance
Your insurer expects you to general maintenance on your possessions and property for reasonable upkeep, and your policy wording will say as much. If you do not duly maintain your insured effects, they may deny your claim. A great example is when trees that are not maintained cause damage to paving or walls.
7. Avoid Defective Workmanship and Low Quality Materials
Defective workmanship and shoddy materials are often specifically excluded. This is specifically excluded. For example, the contractor builds a wall, fails to follow South African building regulations, or mixes the building materials incorrectly and the wall collapses.
8. Assess Your Risks and Choose Your Policy Accordingly
Before you choose a policy, it is wise to ensure the policy will cover all the events you are at risk for. For example, if one of your greatest risks is floods, it is wise to choose a policy that has enough cover for flood damage you may experience.
If an event occurs that you need cover for, but it is not covered according to your policy wording, then your claim will be rejected. Fire, storm, wind, and hail is often covered but some home insurance policies may exclude events like accidental damage or power surges. Before you choose a policy, it’s a great idea to compare options.
9. Avoid Dishonest or Criminal Behaviour and Misrepresentation
Dishonest behaviour or criminal behaviour can result in rejected claims and more serious consequences. You could be blacklisted and thus unable to get insurance anywhere. When you misrepresent the facts or attempt to commit insurance fraud, the insurer is allowed to cancel your policy immediately. The same is true of non-disclosure.
Cover Your House with Home Contents Insurance and Buildings Cover
As you can see from the above, it is very important to understand the terms and conditions and restrictions in your insurance policy. To ensure your claims for acts of nature and damage to your physical structure are not rejected, the biggest step you can take is to read through your policy carefully and ensure you are keeping to all the terms therein.
If you read through your policy and feel you don’t have adequate cover, you can compare options easily. Insurers like Old Mutual Home Insurance and Dial Direct Home Insurance have alternative cover options you can consider. To compare home insurance quotes easily, you can fill in the form below. It’s fast and easy and obligation-free!
Disclaimer: All the information contained in this article is correct at the time it was published. All information provided is for informational purposes only and shouldn’t be construed as legal or financial advice.