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Dawson and Rosenthal
Dawson and Rosenthal

Property Damage Claims and the “Proof of Loss”

Even though the last thing you want is to go through the insurance claims process after your property is damaged, the reality is that we cannot control external factors in our lives. If your property has been damaged, there are various steps you will have to take with your homeowners insurance carrier before they agreed to pay the claim. A “Proof of Loss” is a document that is filled out by a policyholder when property damage occurs. Here, we want to discuss the “Proof of Loss,” particularly the importance of ensuring that this document is filled out properly so that you recover the compensation you are entitled to.

What is Proof of Loss?

Submitting proof of loss is a formal step that every insurance carrier is going to require when a person files a claim. This is an official claim document that the insured will submit to the insurance carrier that validates the repair and replacement estimates and inventories the damaged or destroyed items.

A proof of loss form will be a formal statement notifying the insurance carrier that damage has occurred and will contain a request that the insurance carrier pay out benefits as required under the policy statement. 

Proof of loss forms must be notarized. Most insurance carriers consider a proof of loss form a sworn statement, so long as it has been notarized. However, some insurance carriers require that a sworn proof of loss statement be provided in a separate document.

What Happens After Filing a Proof of Loss Form?

After a proof of loss has been submitted to the insurance carrier, a claims adjuster will review the form and any documentation provided. The claims adjuster is required to respond to the proof of loss document within a specific time frame, as set forth by the insurance commissioner in the state where the loss occurred. In California, the insurance carrier has 90 days to respond to the claimant after a proof of loss document has been submitted. 

If the entire claim or parts of the claim are not insurable, the insurance claims adjuster will send a disclaimer of coverage letter. This explains your liability coverage, property damage coverage, medical expenses coverage, etc. The disclaimer of coverage letter does not means that the claim is approved or denied. The adjuster may need additional evidence, or you may need to clear up any errors you made when submitting the claim.

After a claims adjuster reviews the additional information, they may still choose to investigate the incident or they may accept the claim. If the claim is still under investigation, the insurance carrier has to send a reservation of rights letter that informs you that the claim may be denied. You may also be required to provide additional documentation.

If the claim is insurable, the adjuster will either assign a replacement cost value or an actual cost value to every item that has been destroyed or needs repair. The adjuster will add up all of the damages and work put together a settlement offer.

The insured will have to decide whether or not to accept the offer or negotiate further to receive a higher amount.

Common Issues With Proof of Loss Forms

Often, a claimant makes mistakes when filling out a proof of loss form. Some of the most common mistakes that result in a proof of loss form getting rejected or requiring more documentation include the following:

  • Failing to fill out part of the form
  • Not including all necessary supporting documentation
  • Forgetting to sign the proof of loss form
  • Failing to notarize the proof of loss form 
  • Not documenting all of the losses

A skilled insurance lawyer can help ensure that you fill out your proof of loss form properly. A San Diego property damage attorney can be particularly beneficial for high-value claims, particularly when the insurance carrier may try to push back on paying out the compensation they are required to under the terms of the policy.