Chip Merlin | Property Insurance Coverage Law Blog | September 11, 2019
Holly Soffer is General Counsel to the American Association of Public Insurance Adjusters (AAPIA). Strangely enough, we met and started a dialogue about Insurance Coverage Gaps at a half-day leadership conference hosted by the National Association of Public Insurance Adjusters (NAPIA).
APPIA leadership is doing something about this issue by meeting with insurance regulators and state legislators. They are showing that coverage gaps are harming policyholders and are caused by re-written insurance policies from heretofore standard coverages which did not have these gaps.
In a paper that Soffer provides to educate those about coverage gaps, she writes:
Would your homeowner’s insurance cover you for a loss in your home? Water claims are the most common claims, and many policies leave you far from being made whole after a loss due to water damage.
Consider this typical scenario: You, the homeowner, return home from a weekend away and take a shower, only to find that upon doing so, the living room ceiling under that shower gives in under the weight of water and there is now a pool of water on the hard wood floor and furniture underneath. Your college age son has been staying at the house while you were away. You immediately call your son, who says, ‘I think I saw a stain on the ceiling a few days ago, but it’s a high ceiling, and I wasn’t sure. In different light, I didn’t see anything.’ You then call your homeowner’s insurance carrier, assuming that the damage will all be covered, and you will be made whole so that your home looks like it did before the water damage.
Unfortunately, you learn that all of your damage may not be covered, and that what you thought was a simple matter is actually very complex. The extent to which you will be covered, if at all, for the ensuing damage from the loss will depend upon the specific wording of your insurance policy, a policy that you most likely have never read, and is difficult to understand, even by insurance professionals. We call this gap between what you as a consumer reasonably believe is covered by your policy, and what is actually covered, a ‘coverage gap’.
Insurance restoration contractors and policyholders need coverage to rebuild structures after losses occur. Public adjusters have nothing to adjust if there is a huge coverage gap. We need to educate and then promote laws and regulations which will fix this significant problem. Merlin Law Group is dedicated to this worthy fight.
On Thursday, September 26 at 12:30 EST, Merlin Law Group and AAPIA will host an introductory 30-minute webinar on the issue of coverage gaps and what can be done to stop this problem. Yours truly and Holly Soffer will moderate this discussion. Rutgers insurance law Professor Jay Feinman, the author of Delay, Deny and Defend will have a guest video appearance about his work on the topic and what you can do to help.
More details will be forthcoming, but this is something worth fighting for.