How Our Insurance Carrier Defines Physical Loss?

The coverage grant of your insurance policy governs whether you can claim a “direct physical loss” or not. Physical loss is an essential threshold requisite for insurance under most of the insurance policies. However, the company’s interpretation of a physical loss to your asset solely depends on the kind of coverage you opt for. 

A skilled public adjuster can work through all the technicalities of your insurance policy to the maximum claim that you own! Essentially, any visible and physical damage that occurs to your home can include a claim for physical damage to property.

The insurance companies put up conditions

Insurance companies state preconditions for the loss to be ‘physical.’ This requirement is widely exploited to rule out alleged losses since they might be intangible or incorporeal. In such a case, getting an insurance policy would be rendered useless as it won’t hedge you against physical losses. 

It is the State Law that exercises authority over insurance coverage issues. Many companies have not definitely fixed on what the phrase “direct physical loss or damage” means in property policies. Thus, leaving room for many open-ended possibilities that might or might not be in your favor.

This is where experienced Public Adjusters at United Claims Specialists can help you by representing your insurance claims. Each claim is different, but hiring Public Adjusters can potentially increase your claim payments.

Experts can tackle it better

There are cases where the insurance companies have stated that unless there is variation in the physical structure of a property, there is no direct physical loss. Whereas, the usability of the property is an important factor, sufficient to claim recovery.

Consequently, as the policyholder, you would have to testify with concrete proof that your loss is incorporated under the policy’s clause. In simpler terms, it means that as a policyholder, the burden to prove the loss of your property lies on you. If this sounds overly taxing, let the United Claims Specialists tackle the matter of contention with your insurance company!

If your loss is not physically credible – What’s next? 

Several all-risk property policies do not lay out the definition of physical loss or damage. The Port Authority v. Affiliated FM Ins Co., allude to the widely accepted definition of physical loss as a “distinct, demonstrable, and physical alteration” of its configuration. For instance, significantly viewable damage to your property due to water or fire. 

There can be chances when a physical loss persists, but it is not detectable to the naked eye. However, your property has degraded in terms of usage. The question is, how can you make it evident? The physical imperilments that come out of fire are visible. But, it is difficult to possibly prove the plausible damage to its interior structure. 

Instances where the issues were severe

In 2012, in Universal Image Prods. V. Fed. Ins. Co, the US Court of Appeals, received a plea by a business head for the recovery of business interruption coverage. But according to the Court, there was no structural deterioration whatsoever. It was further opined that water seeping resulting in mold and bacteria contamination of a premise did not incorporate “direct physical damage.” 

Whereas in Farmers Ins. Co. v. Trutanich 1993, a homeowner suffered a “direct physical loss” due to a persisting odor. This emanated from the basement, where the tenant was operating a methamphetamine lab. Here, the Court derived that the odor was physical and damaged the house. 

Having said that, many jurisdictions no longer limit a “direct” physical loss to the literal sense of the term. The Third Circuit claimed that “sources unnoticeable to the naked eye,” can come under an insurance claim. This applies in cases where the physical loss makes your property “uninhabitable and unusable.” 

How can a public adjuster help you?

There is no denying the fact that property insurance policies for homes and businesses are obscure. This is because there are multitudes of factors to consider. As mentioned before, your policy might not clearly explain the direct physical loss. Yet, you would have to demonstrate that there was an alteration to your asset, and this can be extremely challenging. This task is imperative if you want to indemnify the condition for your coverage. 

With a humongous premium scheme, you would want to get tremendous value out of your policy. As an inexperienced individual with limited knowledge about insurance policies, the most viable option is to hire a public adjuster. Hiring a knowledgeable public adjuster can potentially multi-fold your claim payments. 

If you are looking to make the most of your insurance claim, contact the team at United Claims Specialists. We’ll ensure you get the maximum recovery you deserve.