Looking for advice – claim denial for roof damage from hail Roger asked 4 months ago
Looking for advice – claim denial for roof damage from hail

I’m sorry for the lengthy post, but I wanted to present the full picture, so that the suggestions you provide would be more useful for me.

I live in Texas. A lot of my neighbors were getting their roof replaced with their insurance claim payments, in the last few months. When I asked around, the neighbors said that there was a hail storm last year that damaged a lot of the roofs in the neighborhood. On my street, 5 out of 10 homes had their roof replaced, all with insurance claim payments, including my neighbor to the left, the house in front of ours, and the house behind ours, basically all around my house.

So, when I filed a hail damage claim with my insurance, they sent an adjuster to inspect the roof and they denied the claim; when I called and talked to a supervisor at the insurance claim processing company about why my claim was denied, they said the adjuster did not find any hail damage and there was some wear and tear not related to hail damage. When I questioned how it’s possible for so many of the homes around me to have hail damage and not our roof, they asked me to send pictures of my roof showing hail damage. So, I hired a public adjuster to represent me, the adjuster inspected the roof, took photos and concluded there is hail damage and sent a report to the claim processing company, including lots of pictures; they still denied the claim stating their earlier denial still stands and did not give any reason for claim denial.

The public adjuster then told me that if the insurance company at least offered a claim payment, however small that is, they would have been able to go the "Appraisal" route, to negotiate with them on the claim, but since that did not happen, the adjuster is encouraging me to work with a Law firm (that they refer their clients to); the law firm said they work on a contingency fee basis and that their fee would be 40% of the insurance claim payment and the case can take anywhere from 9 months to a year. With the law firm’s contingency fee being so high, I was concerned that the leftover insurance payment (after the law firm’s 40% fee) may not be sufficient to cover the costs of roof replacement and I just wanted to forget about the claim and move on my with my life.

But, a few days back the owner of the public adjuster firm called me and said that if I don’t pursue the claim further, it will affect my home’s insurability negatively going forward. He said that the claim I submitted, along with the public adjuster’s report, photos, as well as insurance adjuster’s report will be a permanent record for all insurance companies to look at. So he said I may not be able to get a new insurance policy from another company (given the claim and the documentation indicating there’s roof damage, whether it’s from wear and tear or hail damage), and he also said that even if I do get some company to provide a policy for my home, they may exclude covering the roof claiming prior damage to the roof. He also said that If I stay with the current company, they will also not pay for any future roof claims, even if there’s new damage from another weather event in the future, again claiming there was prior damage to the roof.

So, it feels like I’m left with no choice but to go work with the law firm and file a case against the insurance company for pursuing the claim further.

I am writing to ask you what are my options at this point, both regarding the claim and also future insurability of my home/roof.

Is working with an attorney my only option now to get my roof claim to be paid ?
Is not proceeding further with this claim going to hurt my home’s insurability, because of the documented roof damage in the claim paperwork ?
Is my claim information with the adjuster’s picture and report available/accessible to all insurer companies ?
After I sign up for a new policy from a new insurance company, is it possible for a new insurance company to cancel my policy, after they inspect my roof ?

What’s the best course of action for me right now, first to get the claim paid and second, to continue to have roof insurance coverage going forward? Thank you very much in advance for your time.

1 Answers
Jim Beneke Jim Beneke Expert answered 3 months ago

It appears that you may be in a contract with a public adjuster, so my comments are purely hypothetical based on the facts that you have put forth, and for the benefit of others who might read this. You should still consult with your public adjuster and / or the attorney he or she may be encouraging you to hire.

First, it seems obvious that there was a hailstorm in your neighborhood. Your neighbors getting new roofs should be enough to document that there was a storm, but if not, someone can run a hail report for you that would add to the evidence. Since hail damage is covered by your policy, there is no “coverage” dispute. The dispute is over the degree, or extent of damage caused by the hail. The fact that the carrier has offered nothing doesn’t mean that there is no damage. It just means that they don’t think there is enough to justify a new roof. Your public adjuster seems to think that the roof is a total loss. In my experience, this dispute over the “extent of, and the amount of, loss and damage” is an appraisable issue.

In fairness to the insurance company, I have seen cases where not every home in a cluster had the same damage. Much depends on the type, age and condition of the roof prior to the event, and the size of the hail that fell. It’s rare for only one home to go unscathed, but it does happen.

Every roof has some degree of “wear and tear” on it. Wear and tear is a condition, not a peril unto itself. Wear and tear usually appears in the form of lost granules over the life of the roof, or the loss of integrity of the seal strip on the shingle which can lead to missing or creased shingles. Most wear and tear is normal and related to the age of the roof. You can’t call your insurance company and ask them to replace your roof due to normal aging or wear and tear.

On the other hand, if your roof has enough wind or hail damage, the insurance company should pay to replace it regardless of normal wear and tear. The insurance company is entitled to withhold depreciation until you replace your roof. That depreciation is largely based on the age and condition of the roof, and the degree of wear and tear present at the time of the loss. The good news is that replacement cost coverage actually allows for “betterment” (new roof for old roof) so long as you replace it.

It is true that insurance companies provide statistical information to the Texas Department of Insurance (TDI) and other groups including the Comprehensive Loss Underwriting Exchange (CLUE). This information is used to track the number of claims filed for a specific property, or property owner. This link will explain what is in a CLUE report, and what is not. https://www.tdi.texas.gov/tips/check-your-propertys-insurance-claim-history.html In my experience, insurance companies do not share actual claim files with each other. They only share the type of information mentioned in the CLUE report.

I couldn’t agree more that it would be a shame to have to pay an attorney 40% of your settlement (plus your public adjuster) to resolve your claim. Appraisal is intended to be the mechanism to resolve a dispute over the amount of a covered loss. If your carrier refuses to appraise the loss, I would file a complaint with TDI and have the insurance company explain why your loss does not qualify for appraisal. If that fails, then you may have no other choice but to engage an attorney.

If you choose to drop the matter, the “record” will show that you turned in a hail claim and your insurance company determined that you had no damage. Regardless of a public adjuster’s opinion to the contrary, the file will be closed with no payment. In that case, your current insurance company should be willing to continue to insure your roof. Other companies should not refuse coverage based on damage that has not been documented by an insurance company or its consultants.

Without seeing the roof, it is hard to know how serious the damage may be. If it is marginal, I would err on the side of closing the file. If it is clearly damaged according to your team (they should be able to show you), I would press on with the effort to get the matter into Appraisal. If the insurance company refuses, I would let the attorney take it from there. Good luck!