Claims for hail damage cost insurance companies millions of dollars every year. Although this kind of damage is a fairly routine loss for businesses and commercial properties across the nation, it has also become a routine practice for some insurance companies to attempt to severely limit the losses that may be recovered for hailstorms. However, insurance companies shouldn’t be able to get away with these kinds of tactics, especially when the financial future of a business is on the line.
What Does “Bad Faith” Mean in a Commercial Property Damage Claim?
An insurance company that acts in “bad faith” is using unfair tactics to avoid paying reasonable claims. The most common ways that insurance companies engage in bad-faith tactics for hail-related commercial property claims include:
- Denying legitimate hail claims. Although a claim for hail losses may be covered under a company’s existing policies, some insurance companies will initially deny claims in hopes of avoiding a large payment.
- Delaying payment of hail claims. Insurance companies have a duty to investigate and resolve claims promptly, but they sometimes choose to leave businesses waiting.
- Making lowball offers and underpaying hail claims. Insurance companies will take advantage of commercial policyholders who don’t understand what their hail claims are worth or can be pressured into accepting less.
However, commercial policyholders can take control when they are being treated unfairly, and they can take action to get a fair outcome for their hail losses under the insurance coverage their businesses pay for each year.
Why Are Commercial Hail Claims So Vulnerable to Bad Faith Insurance Tactics?
While a single hail event may not be a huge financial drain on a single commercial policyholder, hailstorms often affect entire regions. The cumulative costs of the many insurance claims filed for hail losses that span large regions or are frequently affected by storms can represent a huge profit loss for insurance companies. This makes delaying, denying, and underpaying hail claims very beneficial to the insurance company’s bottom line.
Additionally, insurance companies sometimes count on commercial policyholders’ unwillingness to argue over claims or go through the trouble of litigation. In this way, they are able pressure businesses into settling for less or giving up entirely on their claims.
If you own a business and are struggling to get fair payment of a hail insurance claim, don’t hesitate to contact our extensively experienced legal team for help. Additionally, you may want to request and read through a free copy of our book, Commercial Property Owners Must Read This Before Filing an Insurance Claim.