Charles Baisden

When we buy home insurance, we want the company we pay money to each month to cover us in case of any damage to the home and its contents. Unfortunately, insurance companies are notorious for denying legitimate claims on technicalities or lowballing the final payout.

Here are some options for what to do when homeowners insurance denies your claim. 

The DIY Dispute

The first thing you need to do is review your policy and make sure what you’re claiming is covered. Some home policies might not cover damage from earthquakes or floods, so make sure to note whether those claims are covered and how much for. If your home is in a living trust, you’ll have to check how the revocable trust and homeowners insurance work together.

If you have a legitimate claim, then review the paperwork you sent in, and if you think you might need additional evidence to show damage or loss. Use a separate folder to keep the paperwork together with any printed photos, receipts, and repair estimates.

After you’ve reviewed everything, get in touch with your insurer to ask for clarification. Don’t be afraid to ask for the claims manager if the agent isn’t helpful.

Once you get to this point, make sure to document in writing everything your insurer tells you. Make notes during phone calls logging the date, time, names of who you spoke with, and what was said, and email those notes to the insurer or your representative to confirm what you heard.

This will help you to prepare additional documents that you might need to get your claim accepted or to increase your settlement amount, such as repair estimates.

It’s worth noting that some insurers may offer cash in lieu to settle your claim. The definition of cash instead of settlement in insurance is where the insurer cannot pay for repairs if they would leave your home in a better condition than it was before the damage occurred, or if they cannot source the repair materials needed.

If this is the case, you should always double-check how much cash in lieu they’re offering against repair estimates and other quotations from industry professionals.

With these documents in place, you can then write to the claims adjuster for your insurer to dispute the denial or low settlement. One of the claims adjuster’s responsibilities is to negotiate payouts with customers, so don’t be afraid to raise a dispute.

You’ll need to briefly explain why you’re disputing the result, include the evidence for your dispute, and request that they review the claim. Make sure to request they respond within a certain period.

Remember to keep a copy of this letter and the evidence you sent, and, ideally, send it via the certified mail option so you have a record of it being sent and delivered. You should also mail a copy to your adjusting agent’s supervisor.

If there is a further dispute at the end of the review, then you should ask for another at-home visit so you can present any additional evidence, along with testimony from repair professionals and investigators.

If they still won’t accept or adjust your claim, then file a complaint with the state department of insurance. You can find the contact information for this department here.


An appraisal is a good route to take to settle disagreements over how much your property damage should be covered. It’s worth noting here that appraisal isn’t legally binding and doesn’t force your insurer to pay out. However, it is a lot faster and cheaper than pursuing a lawsuit and can result in higher payouts.

In an appraisal, both sides will elect an appraiser to represent them. On your side, you’ll typically have to hire a lawyer or public insurance adjuster.

The two appraisers will review the damage and work together to agree on a payout amount. A neutral umpire, chosen by the appraisers, will be present to break any deadlocks and decide upon an amicable settlement if the appraisers can’t agree.


A mediator is an impartial third party that will work with you and your insurance representative to agree to a settlement amount.

Like appraisal, mediation is non-binding, which does mean that your insurer can ignore the results of the mediation. However, it’s fast and can result in getting your dispute moving.

Some insurers will pay for a mediator, too, but check your policy to make sure – in most cases, you and your insurer will have to split the cost of hiring a mediator.

Mediators can be court-appointed, or if you’re already going through your state department of insurance to handle the dispute, they could be appointed through them. They could also be private professionals who you both agree on being present.

Lawsuits: Your Last Resort

Before you consider filing a lawsuit, you need to try every option we’ve covered above. Lawsuits are long, expensive, and you’re not guaranteed to win at the end. Lawyers will often want to see that you’ve tried other avenues, too.

You’ll also want to look for home insurance claim solicitors, as they specialize in insurance law. Ideally, look for lawyers that offer free consultation sessions so you can find out whether your claim is worth pursuing before you spend thousands of dollars out of pocket.

At this point, it’s important to weigh up the cost of hiring a lawyer against your ideal outcome. The average attorney costs $225/hour, so more complex cases can easily cost thousands of dollars.

Final Thoughts

If your claim has been denied or you feel like you’ve been lowballed by your insurer, there are multiple ways to dispute the result. The first avenue to look into is the DIY option where you negotiate directly with the insurer. If that doesn’t work, then consider appraisal or mediation to get the insurers to accept your claim or increase their payout.

Filing a lawsuit is your final option to solve a dispute, but this should only be done as a last resort.

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