Filing a sizable insurance claim is sometimes necessary. Property owners and others with specialized insurance coverage may face premises liability claims because someone got hurt or incurred major repair costs due to a recent weather event.
Most policyholders understand that they may have to negotiate with the insurance company regarding their coverage. In some cases, that process can be downright contentious. The insurance company may even try to trick or manipulate the policyholder.
For example, the professional responding to the claim may try to pass financial responsibility back to the policyholder by asserting that the coverage amounts have changed or that the company must adjust the deductible that applies. Is it legal for an insurance company to modify policy terms during a claim?
Policy terms are set in advance
If insurance companies could negotiate coverage terms when policyholders made claims, people would be relatively vulnerable to unfair claims outcomes. Therefore, it is standard practice to lock in specific terms for the duration of the policy, which is usually one year.
The policyholder decides how much coverage to purchase and usually sets their own deductible, often based on their cash reserves and how the deductible affects their overall costs. Those terms are what govern any claim made until the next policy renewal.
The insurance company cannot force a policyholder to accept a higher deductible or reduced coverage amounts after they have already paid their premium. In scenarios where insurance professionals attempt to manipulate or lie to policyholders, it may be necessary to respond assertively.
Policyholders experiencing bad faith insurance practices have legal rights and protections. Reviewing policy documents and insurance communications with a legal professional can help frustrated homeowners secure the coverage that they need while only paying the deductible that they previously set.