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Insurance company accused of underpaying for property damage

One out-of-state woman sued her insurance company because reimbursement of damages was vastly underpaid. Her insurance company claimed damages were in the amount of $16,400 while an estimate she submitted showed damages exceeding $47,000.

While she alleges in her lawsuit that bad faith claims handling had occurred, her insurance company replied that losses were caused by items such as "wear and tear, marring, deterioration," smog, rust, inherent defect and other causes.

The woman's home was reportedly damaged in a hurricane. The policyholder states that her home suffered water damage, that the roof was damaged and that there was a variety of exterior damage to her home as well.

The homeowner claims that she was forced to pay out additional expenses for repairs and remediation and that costs came about because she was required to hire engineering and investigative firms. There were also reported consequential damages that came about due to her insurer breaching its contract.

Fortunately we do not have to deal with the mass damage that comes along with hurricanes in Minnesota. However, we do need to deal with tornadoes and floods. With news of possible floods in Minnesota it's always disconcerting to hear stories about insurance companies trying to underpay property damage claims.

When structural damage claims do come about policyholders are often at the mercy of insurance companies. Frequently homeowners do not have time to wait to repair damage and insurance companies may attempt to leverage the circumstances to underpay on a claim.

Homeowners also do not have the experience in negotiating with these large companies. It's during such circumstances that property owners often need to turn to attorneys for representation.

Source: The Louisiana Record, "Insurance company target of Hurricane Isaac lawsuit," Lizzy Fitzsousa, May 28, 2014

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