Frequently Asked Questions
Your Rights and Duties in the Insurance Claims and Litigation Process
How Long does the Insurance Company Have to Pay My Homeowner’s Claim?
30 days. Louisiana insurance companies have 30 days to pay your claim after receiving satisfactory proof of loss under Louisiana Revised Statute 22:1892. If the insurance company does not pay the undisputed portion on time, then, absent legitimate reasons, bad faith damages and attorney fees are owed.
A 60 day timeline for insurance companies to pay your claim also applies. Absent legitimate reasons for the delay or denial, additional bad faith damages may be due under Louisiana Revised Statute 22:1973. For more information, read my blog posts covering bad faith litigation in Louisiana.
What is a Satisfactory Proof of Loss?
Policyholders making an insurance claim must submit a satisfactory proof of loss to their insurance company. This bounces the ball into the insurance company’s court to help you get your claim paid. Doing so is required under your insurance policy and Louisiana law. It also preserves your rights in court to ensure your claim is properly paid and pursue bad faith damages. Under precedent from the Louisiana Supreme Court, satisfactory proof of loss is any evidence “sufficient to fully apprise the insurer of the insured’s claims” and no formal proof of loss is required. See Louisiana Bag Company, Inc. and Lapac Manufacturing, Inc. v. Audubon Indemnity Company, 999 So. 2d 1104 (2008) and and my summary here. There are various ways to make satisfactory proof of loss. Timely reporting the loss and making the property available for inspections with the field adjuster is one way. The better practice is to also submit professionally produced documentation for your satisfactory proof of loss.
Many insurance policies also require that the policyholder submit a signed, sworn proof of loss. The best practice is to comply with these policy requirements. However, you do not have to do so unless your insurance company sends you a form at least 30 days after you file your claim. See Louisiana Revised Statutes 22:1312 and 1313.
How Do I File a Bad Faith Insurance Claim?
Bad faith insurance claims are pursued via litigation. See this blog post for an example bad faith lawsuit.
Does the Insurance Company Have to Pay My Contractor’s Overhead and Profit?
Yes, the insurance company has to pay for overhead and profit. Common industry practice is that anytime 3 or more trades are involved in the repair, overhead and profit is due. Additionally, in the Summer of 2021, the Louisiana legislature made this a legal requirement. Under Louisiana Revised Statute 22:1892 F(1), overhead and profit must be included in loss payments when it is reasonably foreseeable that a general contractor will be needed. For more information, read my blog summarizing the recent amendments to this statute.
How Should My Insurance Company Determine How Much Depreciation is Held Back?
The amount of depreciation deducted, per recent Louisiana legislation, must be reasonable based on objective and subjective criteria that includes the actual condition of the property before the loss. When depreciation is deducted, the insurance company must provide a written explanation of how it was calculated. See Louisiana Revised Statute 22:1892 B. For more information, read my blog summarizing the recent amendments to this statute. It is important to note that depreciation is only held back for actual cash value (ACV) insurance polices. Depreciation is not deducted for replacement cost (RCV) policies.
How Do I Recover the Depreciation?
Once the property repairs are complete, submit documentation showing that. Pictures of the completed work and a signed certificate of completion are usually sufficient to have the depreciation released.
What are My Duties After a Loss?
After an loss from a hurricane or other event, the policyholder generally must:
-Promptly notify the insurance company
-Protect the property from further damage by making reasonable and necessary repairs to protect the property (and keep a record of the repair expenses)
-Cooperate with the insurance company in investigating the claim
-Prepare an inventory of personal property with prices and supporting documentation
-Provide documents to the insurance company when requested
-Make the property reasonably available for inspections
-Submit to an Examination Under Oath
-Send a signed proof of loss to the carrier if timely requested (See Louisiana Revised Statutes 22:1312 and 1313. )
-Comply with all lawful, applicable policy provisions
How Much Money Is My Bad Faith Claim Worth?
Bad faith damages can be substantial. Under Louisiana Revised Statute 22:1892, 50% of the amount found to be due plus reasonable attorney fees can be awarded in the appropriate case. For example, the insurance company fails to pay the undisputed portion of $100,000 within 30 days of receiving satisfactory proof of loss. $50,000 in penalties plus attorney fees of 33% (or more) could be awarded by the court for a total of $200,000.
[Use our bad faith calculator to estimate your bad faith damages.]
Next, under Louisiana Revised Statute 22:1973, consequential damages x 3 can be awarded. Continuing our example, let’s say the insurance company also misrepresented pertinent policy provisions in wrongfully denying the insurance claim. Because of that, the policyholder has to rent a house for a year at $2,000 per month for a total of $24,000. That amount times 3 is $72,000 and could be awarded by the court. The greater of 22:1973 and 22:1982 bad faith damages will apply.
Louisiana law recognizes several theories of recovery for bad faith damages. Examples include when the insurance company arbitrarily fails to pay a claim within 60 days, misrepresents pertinent policy provisions, and misleads the policyholder about the applicable prescriptive period (a/k/a statute of limitations).
For more information, read my blog posts covering bad faith litigation in Louisiana. Browse our home page for an illustration of an example bad faith case.
What’s the Time Limit to Sue My Insurance Company?
2 years. Per Louisiana Revised Statute 22:868 is that policyholders have 2 years to sue their insurance company for payment of property damages. It is best not to wait too long, much less the whole two years, before filing suit. When there is a hurricane or other widespread catastrophic loss event, you want to be near the front of the payment line. Court dockets can become clogged with litigants fighting for their day in court.
What is the Process of Working with Law Office of Nicholas M. Graphia Like?
When you work with me, you can be sure I will give your case the time and attention it deserves to timely settle it for a reasonable amount of money. I will assume the burden of dealing with the insurance company, so you can focus on more important things. More specifically, I advocate on your behalf by:
-Thoroughly reviewing your insurance policy and claims file. This allows me to determine if the insurance company is in compliance with applicable Louisiana insurance laws.
-Dispatching one of the insurance experts in my network of insurance professionals to conduct an independent assessment of the damage to your property. The insurance experts I work with are trained to identify all losses, including hidden damages and report them to the insurance company. This will help ensure nothing is overlooked.
-Working with you to compile all of the information the insurance company needs to process your claim.
-Save you time and money by working with the insurance company on your behalf.
-Drafting a thorough, well documented demand package.
-Negotiating with your insurance company to ensure they agree with our assessment of the damage.
-Litigating your case if necessary.
-Suing for bad faith damages when necessary.
How to Get a Complimentary Case Consultation, Free Policy Review
This is general information only. If you would like to discuss your insurance claim, contact me by phone or email.