In What Circumstance Would A Property Insurance Claim Be Rejected?

Avoid circumstances in which property insurance could be rejected.

Just like life insurance protects the life of a policyholder, property insurance protects your property. This can include homeowner’s insurance that protects your house, renters insurance to provide protection to you if you’re in a rented space, and flood insurance among other policies.

Imagine your property gets damaged or assets are stolen, you could find yourself in for paying a hefty sum trying to revive back your things. But, the situation would be entirely different if you had property insurance.

Let’s see how.

Property Insurance Coverage

Property insurance is basically used as a broad term that covers a number of protection policies under its umbrella, such as homeowner’s insurance, renter’s insurance, flood insurance, earthquake insurance etc.

Property insurance provides coverage in the following areas:

However, a property insurance policy may not cover damages caused due to tsunami, seeping groundwater, drainage issues and a number of other water related damages.

In case of any of the above stated circumstances, you can file a claim with your insurance company and they will issue you a check to cover the expenses. But, the process isn’t as straightforward as you might think.

There are a lot of complications that make their way into this which could delay or even have the insurance claim denied. We’ll talk more about it later in the article.

How to claim Property Insurance?

The first and foremost thing to do as soon as there is damage caused within the property, is to immediately take it up with your insurance company. When you file for a claim, they will ask you necessary information about the incident and the policy itself.

They will then send a representative to the property to take down notes and give a first-hand account of all the damage that has been caused. A smart move for you is to make a list of all the things you lost or were damaged and attach receipts too, if possible. Take photographs and be prepared at your end, make sure you don’t touch or move anything before the representative gets there.

The representative will then send a report to the underwriter, who is an agent involved between you and the insurance company. The underwriter will view you as a genuine case and then the insurance company will issue you a check.

The insurance company will definitely try to minimize the payout, but you should be vigilant enough to negotiate with them. If you had been paying premiums on time each month, it is your right to get the claim for the entire damage, or otherwise clarified in your policy.

How is Insurance Claim denied?

Now that your property has been severely damaged, you head on to the insurance company to file a claim. Upon reaching, you could be shocked to find out that there are reasons why your insurance claim could be denied and you won’t get anything to pay for the expense.

Here are a couple of reasons why that’s a possibility.

  • You don’t file your claim as soon as the incident happens.
  • Your policy doesn’t cover the cause of damage- it is always advisable to thoroughly read the policy before filing a claim.
  • You didn’t pay your insurance premiums.
  • The damage isn’t sufficiently documented.
  • The insurance adjuster finds anything suspicious or false in the claim.
  • You didn’t take precautions to prevent further damage after the initial loss.

Although some reasons are totally at your expense, you should know exactly what the policy will cover and then act the claim accordingly. The least you can do in these testing times is to file a claim as soon as the incident takes place and not waste any more time.

What to do if an Insurance Claim is denied?

If your insurance claim is denied, you have the right to ask for reason, and the insurance company will provide you with one. You can negotiate with the insurance company and find out loopholes if you can still be adjusted in the policy somewhere.

If you feel the claim was wrongfully denied, you can take it up with an attorney and file a proper complaint. You can also take pictures of the incident and document the loss properly with whatever proof you have- this way you can make your case even stronger.

You can also request an independent appraisal, or show that you’re a responsible homeowner. You have to prove that the damage was NOT intentional and that the claim you’re making is genuine.


Even though very rarely, there are circumstances where a property insurance claim could be rejected, but you need to stay ahead of the situation and make sure that none of these affect your claim.

Tony Bennett

Tony Bennett

Tony Benett makes his living in the insurance industry by teaching and consulting. He is also recognized by the legal profession as an expert on insurance coverages. His insurance experience includes having worked at the company level, owned an independent general agency and having worked for an insurance association. He has received various certificates over the past few years and helps his clients and readers by giving them a realistic outlook on what they can expect to achieve within their set targets. At Insurance Noon, he is known for his in-depth analysis and attention to details with accuracy. He has been published as one of the most referred agents by his peers in the insurance community. Tony loves the outdoors and most sport events. His passion other than providing excellent advice is playing golf.

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