Having an insurance claim rejected can be frustrating, particularly when you are relying on your policy to cover damage or loss to your home. If your home insurance claim has been denied, it is important to understand why the insurer reached its decision and what options may be available to you.
A rejection does not necessarily mean the matter is over. You can review the insurer's reasons, check your policy, gather supporting evidence and ask the insurer to reconsider its decision. If the dispute remains unresolved, you may also consider obtaining legal advice about your rights and available options.
What Is a Home Insurance Claim?
A home insurance claim is a formal request made to an insurer for payment or assistance following an insured event affecting your property or belongings. Depending on the policy, this may include events such as storm damage, fire, theft, flooding or certain types of accidental damage.
The insurer assesses the circumstances against the terms, exclusions and conditions of the policy before deciding whether to accept, partially accept or reject the claim.
How Do I Make a Home Insurance Claim?
The first step is generally to notify your insurer as soon as reasonably possible after the incident. You should provide the information and evidence requested by the insurer and take reasonable steps to prevent further damage where it is safe to do so.
Depending on the circumstances, useful evidence may include photographs, videos, receipts, repair estimates, reports and other documents showing the condition of the property and the circumstances surrounding the loss.
Keep copies of everything you submit and record important communications with your insurer. A clear record can be useful if the insurer later disputes aspects of your claim.
Why Would a Home Insurance Claim Be Denied?
There can be several reasons why an insurer rejects a home insurance claim. The reason should generally be explained in the insurer's decision or correspondence.
Common reasons may include:
- The insurer considers the incident excluded under the policy.
- The insurer believes the damage resulted from an event that is not covered.
- The insurer disputes the cause or extent of the damage.
- The insurer considers that a policy condition has not been met.
- The insurer believes there is insufficient evidence to establish the loss.
A rejection should therefore be considered alongside the actual wording of your policy rather than relying only on a general explanation from the insurer.
What Happens If an Insurer Rejects My Home Insurance Claim?
If your home insurance claim is rejected, start by carefully reviewing the insurer's written decision. Identify the specific reason for the rejection and the policy clause the insurer has relied upon.
You should then compare that explanation with your policy documents and the evidence you provided. If you believe the decision is incorrect, you may be able to ask the insurer to review its decision and provide additional information or evidence.
Do not overlook the importance of the insurer's reasoning. Understanding exactly why the claim was rejected can help determine whether further evidence, clarification or a formal dispute is appropriate.
Can I Appeal a Home Insurance Claim Decision?
Yes, depending on the circumstances, you may be able to challenge an insurer's decision. The appropriate process can depend on the insurer, the policy and the nature of the dispute.
You can generally begin by making a complaint through the insurer's internal dispute resolution process. Provide a clear explanation of why you disagree with the decision and attach relevant supporting documents.
If the matter is not resolved through the insurer's internal process, you may have further avenues available. In Australia, the Australian Financial Complaints Authority (AFCA) can deal with many disputes involving financial firms, including certain insurance disputes.
The time limits and eligibility requirements can vary, so it is important to consider the relevant process promptly.
How Long Do I Have to Make a Home Insurance Claim?
The timeframe for making a home insurance claim can depend on the terms of your policy and the circumstances of the loss. Some policies require you to notify the insurer within a particular period or as soon as reasonably possible.
If your claim has already been rejected, other time limits may also become relevant when considering a complaint or dispute. For this reason, you should avoid delaying action simply because you are still gathering information.
Check your policy carefully and seek advice if you are uncertain about a deadline that may affect your rights.
What Documents Are Needed for a Home Insurance Claim?
The evidence required will depend on the type of loss and the insurer's concerns. Documents that may assist include photographs of the damage, invoices, receipts, repair quotations, expert reports, proof of ownership and correspondence relating to the incident.
If the dispute concerns the cause of damage, technical evidence may be particularly important. For example, a building or specialist report may help establish how and when damage occurred.
It is also useful to retain the insurer's rejection letter, policy documents and records of conversations or emails. These documents can help create a clear timeline of the home insurance claim and the issues in dispute.
What If the Insurer's Settlement Offer Is Too Low?
A claim does not always have to be completely rejected for a dispute to arise. An insurer may accept part of a claim while offering an amount that you believe does not adequately reflect the covered loss.
In this situation, review how the insurer calculated the proposed settlement and compare it with your policy and available evidence. Repair estimates, invoices, photographs and independent reports may help demonstrate why you believe the amount should be reconsidered.
Where appropriate, you can raise your concerns through the insurer's complaint process and request an explanation of how the settlement figure was determined.
Can a Lawyer Help With a Rejected Home Insurance Claim?
Yes. An insurance lawyer can review the circumstances of a rejected home insurance claim, examine relevant policy terms and help assess the basis for the insurer's decision.
Legal advice may be particularly useful where the policy wording is complex, the insurer disputes the cause or extent of the damage, significant losses are involved, or attempts to resolve the dispute directly with the insurer have been unsuccessful.
A lawyer may also help you understand the available dispute-resolution options and the evidence that may be relevant to your position.
For people dealing with other types of insurance benefits, legal assistance may also be available for Superannuation Claims, depending on the circumstances.
Can Car Insurance Lawyers Help With Other Insurance Disputes?
Insurance disputes can arise across different types of policies, and the relevant policy terms and dispute process can vary. Car insurance lawyers may assist with certain motor vehicle insurance disputes, while lawyers handling property insurance matters can focus on issues arising from home and property policies.
The important point is to obtain advice that is relevant to the type of insurance policy and dispute involved.
What Should You Do After a Home Insurance Claim Is Rejected?
If your insurer has rejected your claim, avoid assuming that there is nothing further you can do. Start by obtaining the rejection decision and identifying the precise reason for it.
A practical approach is to:
- Review the rejection letter and policy: Identify the policy clause and reasoning relied upon by the insurer.
- Gather relevant evidence: Collect photographs, reports, receipts, repair estimates and correspondence that may address the insurer's concerns.
- Request a review where appropriate: If you believe the decision is incorrect, explain why and provide supporting information.
- Consider dispute-resolution options: If the issue remains unresolved, determine whether an internal complaint or external dispute process may be available.
- Seek legal advice: If the dispute is complex or involves significant financial consequences, consider speaking with an insurance lawyer about your position.
Get Advice About Your Rejected Insurance Claim
A rejected home insurance claim can leave homeowners uncertain about what to do next. However, an insurer's decision can often be examined against the policy wording, available evidence and the circumstances surrounding the loss.
WKB Lawyers assists clients with insurance-related legal matters and can help assess the circumstances of your dispute. If your claim has been rejected, delayed or you believe the insurer's decision does not properly reflect your policy entitlements, obtaining advice early can help you understand your available options.
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