It may be time to hire a lawyer for an insurance claim if you can’t reach an agreement with your insurance company or the insurer seems to be delaying the claim process on purpose.
Other situations where you might seek out an attorney include complicated claims where the cause or party at fault is murky or for major losses where the legal fees could be worth it to maximize your payout.
Here’s what we learned from two lawyers about how they help people get better outcomes from insurance claims.
When to Hire a Lawyer for a Home Insurance Claim
One reason to hire a lawyer to assist with your insurance claim is if you have a large or complex case and think the lawyer will be able to put more dollars in your pocket than you’d be able to obtain on your own.
“The second reason to hire a lawyer is time arbitrage,” says Brian Glass, a personal injury lawyer with BenGlassLaw in Fairfax, Virginia. “If your time is better spent working, taking care of your family or earning money in other places than it would be doing the work to become an expert on the law, you should consider hiring a lawyer even if you are likely to receive the same number of dollars in your pocket.”
An attorney is not likely to take your case unless it is worth their time, especially under a contingency fee arrangement where they receive a percentage of your insurance payout if they win your case in court or settle out of court. Other common fee arrangements are retainer-based and hourly.
“Hiring a lawyer becomes essential in cases where there is a huge claim amount, when the fault is difficult to establish or when there is a huge difference in the amount you want and the claims adjuster quotes,” said Lyle Solomon, principal attorney at Oak View Law Group in Auburn, California.
“Most lawyers provide free advice before you even hire them for your insurance claim,” Solomon says. “So it makes sense to at least contact them before you proceed with your claim and talk to any representative of the insurance company.”
If you have a large or complex case, you may want to have an attorney review your insurance policy before you file a claim with your insurance company. A lawyer can help you understand the legal jargon and technicalities that may affect your claim.
What Type of Lawyer Should I Hire for an Insurance Claim?
Hire a specialist, Glass recommends. “The lawyer whose website says they handle everything from wills to insurance claims to divorce is probably not the best lawyer for an insurance claim case,” he says.
Friends, family and colleagues are always a good place to start when seeking a referral. If they personally know or have worked with any type of attorney, that attorney may be able to recommend someone who deals with insurance lawsuits.
If you have an employer benefit that covers attorney services (one example is MetLife Legal Plans), that’s another place to look. You can also start a search at the American Bar Association’s list of state bar associations.
Check the attorney’s credentials by looking them up on your state bar association’s website. You can also find out what clients have said about the attorney and their staff on Avvo, a lawyer directory site.
Some helpful questions to consider when evaluating a potential lawyer or firm are:
How long has the lawyer been admitted to the state bar?
Is their license active?
Does the attorney work directly with clients or hand clients off to staff?
When you call the office, how does the person who answers the phone treat you?
What’s a Reasonable Timeframe for an Insurance Claim?
How long your insurer should take to process a claim depends on the complexity of the claim, requirements under state law and any competing demands for claims services.
Some claims are inherently simpler to resolve than others.
A claim for damage to a fence during a major storm in your area might be simple for your insurer to process. The circumstances of the event are known by the insurer because it affected thousands of homeowners.
That said, things can go wrong even with seemingly simple claims. You might think the insurer should replace your entire roof. Your claims adjuster might think otherwise. A dispute means your claim will take longer.
A homeowners insurance claim involving suspected arson could take longer to pay out. Multiple involved parties and murky facts can complicate things.
Your state might have laws requiring insurance companies to take certain steps in the claim process within a certain period.
In Texas, insurance companies have:
15 calendar days to acknowledge your claim and request any additional information needed.
15 business days to approve or deny your claim in writing after receiving all requested information. This can be extended to 45 days if the insurance company notifies you in writing and explains the reason for the delay.
5 business days to pay the claim after notifying you that your claim has been approved.
After a major disaster, state law may grant insurers extra time to respond to policyholders. For example, Louisiana normally requires insurers to start adjusting a claim within 14 days, but allows 30 days and sometimes 60 or 90 days if the state governor or U.S. president declares a disaster.
When a widespread disaster affects your area, or when major disasters happen in lots of different areas simultaneously (such as multiple wildfires, insurers can struggle to process everyone’s claims in an ideal time frame—hence, the leniency state law may allow for.
What Are the Steps to Settle an Insurance Claim?
You can improve your chances of a quick claim settlement by understanding how the process works and where you can help speed it along.
Find out if your loss is covered
Understanding your insurance coverage will help you determine if you should file a claim. Look at your policy’s declarations page and read your policy to review what’s covered and what’s excluded. If you have questions, your insurance agent or an attorney can help.
Gather information about the loss
Your insurance company (or the insurer of the at-fault party) will require certain information to handle your claim. Make sure you submit all the documents requested, or your claim will be delayed.
File your claim
The sooner you file your claim and provide all the information the insurance company asks for, the sooner you will get a claim payment. The insurance company will assign an adjuster to your case who will become your point of contact for questions.
Stay on top of your claim
Contact the adjuster if nothing seems to be happening with your claim. Make sure to respond to any calls or emails promptly and provide any additional information required to process your claim.
Evaluate the claim settlement
Does the amount the insurance company is offering you seem fair based on the facts of your case? If so, great! If not, find out why the adjuster has arrived at the amount they did so you can identify opportunities to push for a higher settlement.
Consider a public adjuster
While your insurance company adjuster serves the financial interests of your insurer, a public adjuster advocates for you, the policyholder. If you have a large claim and need help negotiating your settlement, consider working with a public adjuster. They can help you understand your coverage, make sure you’re providing the right documents for your claim, and maximize your claim payment.
Contact the state department of insurance
If you believe your claim settlement is unfair, the state department of insurance should be able to help you resolve issues with your insurer. They are also the official place to file complaints against insurance companies.
Can You Negotiate a Claim Settlement?
Insurance settlements can be negotiated. Propose a counter offer backed by facts about why your payout should be higher.
While your main point of contact might be the claims adjuster assigned to your case, artificial intelligence (AI) may be the source of your settlement offer. Both insurance companies and attorneys are increasingly using AI to identify settlement amounts for similar situations.
How Do You Respond to a Low Settlement Offer?
For some claims, you might need professional help to negotiate a better settlement offer.
The top two things that cause a denial or low settlement are lack of documentary evidence and lack of an attorney, according to Solomon. If the insurance company figures out you are approaching them without an attorney and proper legal advice, they may try to deny your claim or give you a very low offer based on specific legal language in your policy, he says.
“Let’s say you are making a home insurance claim. Your house was damaged through water leakage or water damage,” Solomon says. “Homeowners policies usually contain exclusions based on neglect. Now, once you make a claim for the water damage, your insurance company may deny it by stating neglect, especially if it was gradual water damage where you might have failed to repair some broken pipes. In such a scenario, having a lawyer by your side is very helpful.”