State Farm denies another homeowner’s claim for water damage

State Farm denies another homeowner’s claim for water damage

A consumer advocate says she’s seeing an increase in State Farm denials.

State Farm denies another homeowner’s claim for water damage


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CHULA VISTA, Calif. — More homeowners are coming forward saying State Farm is denying their water leak damage claims. CBS 8 is Working for You to find out if this is a pattern by the insurance company.

Mark Matthews has lived in his Chula Vista home for 25 years. And, he says, he’s been a customer of State Farm for more than 30 years, without ever filing a claim.

Matthews said a hot water pipe above his kitchen started leaking on April 21, and caused what he estimated to be $20,000 in damage, flooding out his dining room. “One little pipe that was just drip, drip, drip, drip, drip,” said Matthews.

He and his wife called a water-damage service company and furniture movers. Then, the State Farm Insurance adjuster showed up. “He just said straight to our face, no, we’re not covering this because it’s a continuous leak, which State Farm does not cover. They’ll just cover a sudden leak,” recalled Matthews.

He was shocked because the couple had never noticed any water leaking in the past. “Even the report from the plumber said it was a sudden, pipe burst, but (the State Farm adjuster) wouldn’t have any of that,” said Matthews.

He emailed after CBS 8 aired a similar story with a homeowner in University City who was denied by State Farm for damage caused by a leaky roof.

CBS 8 reached to a consumer advocate, Amy Bach, at United Policyholders. “We are seeing a pattern of State Farm denying water damage claims on the grounds that it was a gradual seepage or continuous leakage, as opposed to a sudden accidental event. And that they are using that argument to avoid paying for what we believe are covered losses,” said Bach.

She said if attorneys find out State Farm is unfairly denying water damage claims, there could be a class-action lawsuit. “It may be at some point that a consumer like this gentleman would end up being a plaintiff in a class-action suit with a whole bunch of other people who’ve been similarly harmed,” said Bach.

State Farm emailed CBS 8 the following statement:

“Due to our customer privacy policy, we can’t speak to the specifics of a claim. Our approach to claims has always been that each claim is unique and handled on its individual merits. With any claim, State Farm seeks to provide our customers all benefits to which they are entitled within the terms of the insurance policy. As part of our commitment to our customers, we welcome additional information that may help us identify any applicable benefit under the policy.”

At CBS 8, we are always Working for You and our community. This is a station promise that we will go the extra mile to solve a problem our audience can’t solve themselves. We want to hear your ideas on how we can cover and help our community. If you have a story idea, please email us at


Hail Season is Coming: 8 Must-Know Tips For Colorado Homeowners Navigating Insurance Claims

— Be Aware of Policy Clauses That Could Limit Time to File and Jeopardize Your Recovery —

Colorado is no stranger to severe hailstorms, with the state experiencing some of the most destructive hail events in the nation. Peak hail season typically runs from mid-April through September, when powerful thunderstorms can generate hailstones the size of golf balls or baseballs, causing widespread damage to homes, businesses, and vehicles.

Colorado experienced an exceptionally active hail season in 2023, with over 150 reports of 2-inch or larger hail – the second highest in the country. This included several major events, including the late June storm that injured nearly 100 concertgoers at Red Rocks Amphitheatre with 2-inch hail. Just a week later, baseball-sized hail caused widespread damage in Brush, Colorado. On August 5th, the Colorado Springs area saw 1.5 to 1.75-inch hail.

Homeowners often face extensive roof damage, shattered windows, dented siding, and destroyed landscaping after a major hailstorm.

“Hail is a common and destructive phenomenon in Colorado, causing billions in property damage each year,” said Jonathan E. Bukowski, an attorney with the Denver office of the Merlin Law Group. “By understanding the claims process and their rights as policyholders, homeowners can ensure a fair and full recovery.

“What’s important for people to know is the insurance policies are allowed to limit your time to pursue your claim against the insurance company,” he said. “Known as ‘contractual limitation,’ it means you might not be able to hold your insurance company accountable because the state of Colorado allows these policies to set a time limit.”

While it could be three years for a homeowners policy, homeowner associations or business owners can be limited to six months or a year. “A commercial claim could take more than 12 months, especially for the larger, more complex claims,” Bukowski said.

Bukowski offers these essential tips for Colorado residents navigating the insurance claims process:

  1. Always Request a Certified Copy of Your Insurance Policy – This provides the full details on the type of damage covered or excluded and the specific terms you’ll need to follow.
  1. Understand Policy Limitations and Exclusions – Review the policy carefully, as it may have restrictions on matching materials or depreciation schedules. It will also lay out the timeframe which you have to take legal action against your insurance company if you do not agree with their investigation. If legal action is not taken within the timeframe specified in the policy, you lose out on the ability to enforce the insurance contract.
  1. Act Quickly to Document Damage and File Your Claim – Inspect your home thoroughly and take detailed photos/videos as soon as possible after a hailstorm. Photographs help in capturing the extent of the loss.
  1. Assess the Insurance Adjuster’s Credentials – Always ask for the qualifications and experience of the personnel assigned to inspect the loss – oftentimes insurance companies will use people unskilled in evaluating damage or who do not have an understanding of the coverages under the policy.
  1. Request a Complete Copy of Investigation Reports – Always request a copy of the report prepared by an investigator or engineer and confirm that the investigation was for the type of damage covered under your insurance policy. Engineering firms will often investigate under an elevated threshold of damage, such as functional damage, that is not required for coverage under the insurance policy.
  1. Obtain a Second, Independent Inspection – If you disagree with the insurer’s assessment, hire your own qualified inspector or professional engineer.
  1. Review the Repair Estimate Carefully – Does the estimate include the necessary scope of repairs to fix your property or provide an allowance for the cost of a general contractor to supervise and coordinate the subtrades?
  1. Don’t Hesitate to Seek Legal Guidance – An experienced insurance claims attorney can protect your rights and maximize your recovery.

For more information, contact the Denver office of the Merlin Law Group at (720) 665-9680 or visit

About Merlin Law Group

With offices in Denver and across the U.S., Merlin Law Group is a national law firm dedicated to representing policyholders in disputes with insurance companies. Founded by William F. “Chip” Merlin Jr., the firm has recovered over $2 billion for clients and is renowned for its advocacy on behalf of homeowners, businesses, and communities impacted by natural disasters. For more information, visit,


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USAA CEO Compensation Rose Dramatically in 2023 — Along With Customer Premiums

USAA President and CEO Wayne Peacock was paid at least $8.1 million in 2023, an increase of more than two-thirds of his 2022 compensation of $4.8 million.

That year, USAA reported its first-ever annual loss, a net loss of $1.3 billion, which it blamed on inflation, rising interest rates, supply chain woes and payouts totaling more than $2.5 billion.

Peacock, who became CEO of the financial services giant in 2020, earned $1.9 million in 2021. All of his compensation amounts come from the Nebraska Department of Insurance.

The five USAA insurance companies that reported executive compensation for 2023 included USAA Life Insurance, USAA General Indemnity, USAA Casualty Insurance, United Services Automobile Association and Garrison Property and Casualty Insurance.

In addition to insurance, USAA provides insurance, banking and investment services to more than 13 million members of the U.S. military, veterans and their families, according to its 2022 annual report.

Executives’ compensation, which was first reported in the San Antonio Express News, rose alongside customer premiums. On an annual basis, auto insurance costs rose 17.4% in 2023, according to the Bureau of Labor Statistics, the biggest jump since 1976. A spokesman for AAA told Yahoo Finance that higher and more expensive claims are driving the increase.

Home insurance rates rose an average of 11.3% last year, according to S&P Global Market Intelligence, with USAA rates up 14.7%. Texas homeowners saw the steepest increase in rates last year, at more than 23.3%. Companies are reporting inflation and high reinsurance rates as culprits.

In an October press release, the Consumer Federation of America, an association of non-profit consumer organizations, criticized rising insurance executive compensation at the same time consumers are paying higher premiums.

“Insurers are telling regulators that ordinary consumers have to pay much more for auto and home insurance because the companies are struggling with inflation and climate change,” said Michael DeLong, CFA’s research and advocacy associate, in the statement.

“But they are quietly handing CEOs gigantic bonuses. … [T]here needs to be more scrutiny of the rate hikes companies are demanding and the huge CEO paydays that are funded with customer premiums.”

The nonprofit listed 2021 and 2022 compensation for the top executives at ten insurance giants, including USAA. Peacock’s was the lowest of the ten; CEOs at State Farm and Travelers pulled in $24 million and $20 million, respectively.

Other top USAA executives also saw their compensation rise in 2023. USAA Life President Brandon Carter’s compensation rose from $1.8 million in 2022 to $1.9 million in 2023. The vast majority of that, as in most executive compensation packages, came through bonuses. Carter’s salary in 2023 was listed as $473,000, with a $1.3 million bonus.

Randy Termeer, listed as president of P&C Insurance Group, saw his compensation grow to $2.2 million in 2023, up from $1.6 million the year before, over two-thirds of that as bonuses.

Peacock’s bonuses made up $6.8 million of his compensation, or 84% of the total $8.1 million.

“Compensation for the CEO and all executives includes base and incentive pay as well as compensation that is paid out over a period of multiple years,” said USAA in a statement. “Their total compensation varies based on performance, market conditions and other factors.”

“Recruiting top talent at USAA allows us to provide members with highly competitive products and exceptional service they expect and deserve. This helps us meet our mission to empower the financial security of the military community and their families.”

Late last year, the company announced it would expand its education benefits for employees and their dependents in an effort to attract and retain talent. USAA employs roughly 37,000 people around the country, including 19,000 here in San Antonio, where the company is headquartered. It laid off several hundred people in 2022 and 2023.

USAA has not yet released its 2023 annual report; in 2022, it reported the $1.3 billion net loss down from a $3.3 billion profit in 2021, and just over $36 billion in revenue in 2022, a 3% decline from the previous year. The company’s net worth dropped to $27.4 billion in 2022 from $40 billion.

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There is a row of three illustrated faces: One smiling, one neutral and another frowning. A customer points to the frowning face, suggesting dissatisfaction.

J.D. Power: Homeowners Property Claim Satisfaction at 7-Year Low

There is a row of three illustrated faces: One smiling, one neutral and another frowning. A customer points to the frowning face, suggesting dissatisfaction.Customer satisfaction has also been negatively affected by rising premiums, as well as the higher deductibles some policies require for catastrophic weather damage from wind, hail and other storm-related perils. Photo: terovesalainen/Adobestock

An increase in severe storms and high-severity claims has led to slower time frames for the claims process. Repair cycle times now average 23.9 days – more than six days longer than in 2022. When it comes to claims related to catastrophic events, that time frame increases to an average of 34.2 days.

In turn, customer satisfaction with homeowners property claims has dipped to its lowest level in seven years, reports J.D. Power.


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Claims Process

How do I make a claim? Why should I make a claim?

For most homeowners, making a claim can actually be a scary process. Everyone’s biggest fear is being denied and having to pay for everything out of pocket. We are here to help you understand that it does not have to be scary. Our team is here to help you every step of the way.

    1. A claim minimizes your out of pocket expenses – our goal is that you only pay for your deductible and for any upgrades you choose to have done when it comes time for reconstruction.
    2. A claim allows you to get it done right and not cut any corners in order to save money
    3. What do you pay your insurance for, if not to use it in your time of need?
    1. Call your insurance company’s Claim Center – this phone number can be found on your most recent bill, within your insurance app, online or our office can provide you with your Claim Center’s phone number (usually a toll free number).
    2. They will ask you a series of questions:
      1. When did it happen? Or when did you notice it? (Make sure to indicate to them that you noticed it no more than 72 hours ago.)
      2. What happened? (i.e. Pipe break, sewer line clog, toilet overflow etc.)
      3. Have you fixed the source?
      4. Do you need a restoration company? Make sure to let them know you have already hired one – All Pro Restoration – and provide them with our contact information
    3. Once these basic questions have been answered, the claim center will issue you a claim number. We need this claim number in order to work directly with your insurance company.
    4. An adjuster will be assigned to you within the next 1-2 business days.
    1. Our technicians cannot guarantee you coverage, however we are versed in seeing what types of losses are typically covered and typically are not covered. We can provide a general assessment of your loss and its likelihood of being covered.
    2. Your adjuster is the only person who can actually determine coverage on your particular loss.
    1. We recommend reaching out to a Public Adjuster before assuming this will be all out of pocket. Please see ask us about our Public Adjuster handout in which we can tell you more about why calling one will be in your best interest.
Claim Form

Will Insurance Claim Premiums Rise?

Will Insurance Claim Premiums Rise?Buying an insurance policy is something of a paradox unto itself. Generally speaking, insurance of all types is something that you purchase hoping that you never have to use it at all. You would never buy a car and just let it sit in the garage, hoping that the day never came where you would have to get behind the wheel, put the key in the ignition and go for a spin. Despite that, insurance is still necessary to have in the unfortunate event that you do need it the most. One of the most important factors that many people struggle with has to do with the claims process. People do not want to make an insurance claim at all because they are concerned that their premiums will go up. As with insurance as a concept, the answer is not necessarily straightforward.

Your Premium Will Change Over Time

For starters, you should never worry about filing an insurance claim because your rates might increase for one simple reason: your rates will likely increase whether you want them to or not. Many of the reasons why your rates might go up will have little to do with the claim in question.

One of the primary reasons why insurance rates might increase has to do with the age of the home in question. The older the home, the more liability there is for the insurance company to insure and financially protect that home. As your general sense of liability increases, so do your insurance premiums.

Natural disasters in surrounding areas can also increase your premiums. If your area has seen a rash of fires, floods, storms and other types of events that are beyond your control, your insurance company may look at you as statistically more likely to suffer from the same types of damage and increase your rates as a result.

Mass Claims Affect Premiums

Another reason why your rates might go up has to do with the amount of recent claims the company in question has been dealing with related to certain types of losses. Sometimes certain portions of your policy are designed to naturally get more expensive as homeowners in the surrounding area have made claims pertaining to one specific type of loss. If there has been a rash of burglaries in your area, for example, other homeowners may cause your rates to go up even if you have not been affected.

The point is that every insurance company is different regarding what events cause a premium to go up and what allows that money to remain unaffected.

It’s always a good idea to speak to your insurance agent. He or she will be more than happy to sit down with you, go over the specifics of your own personal policy and address any and all concerns that you may have.Will Insurance Claim Premiums Rise?

A lot of insurance agents will do just about anything to retain their customers. As a result, they may actually have significant pull in the decision about the way that your premiums might be altered after filing a claim. Though it is not a guarantee, talking to your provider about your concerns may be a way to allow your premium to remain the same even if a claim has taken place.

The most important thing to remember involves how serious the situation in question really is. Will the claim that you are filing exceed your deductible? If the answer is “yes”, then you do not need to make a claim. Can you afford to pay for the services that you need out of your own pocket in the event that it does exceed your deductible? If the answer is “no”, then the situation dictates that you should likely make a claim...

Water Damage Restoration Cost

How Much Do Insurance Claims Cost?

How much do Insurance Claims Costs?People may be hesitant to file an insurance claim for a wide variety of different reasons. The most common reason is because that person feels that their insurance rates may go up to unaffordable levels due to even one small claim. The reality of the situation is that insurance claims are a natural part of the process and may be the only way to help get the money you need depending on the specifics of the situation. When it comes to filing an insurance claim and why the process is so important, one of the key things to understand is how much that claim is going to cost.

Insurance Claim Costs

When talking about homeowner’s insurance, the cost to file an insurance claim will depend very much on the specifics of the policy in question. The cost to the homeowner is dependent on two key things: individual policy limitations and deductible amounts.

Deductibles are the total amount of money that you have to pay out of pocket for a particular claim before your insurance will go into effect. These deductibles are made available to the homeowner well in advance and are typically agreed upon when signing up for insurance in the first place. The average deductible can range anywhere from $250 to $5000 or more depending on the policy. However, the most common are $500 or $1000.

Your deductible should play a factor in deciding when and if to make a claim. If you are filing for a loss of only $100, it may actually be more beneficial to you in the long run to just pay the money out of pocket and avoid filing the claim altogether. If you lose your home to a fire and suffer a total loss, on the other hand, even a deducible of $5000 or more will still pale in comparison to the amount of money that your homeowner’s insurance will pay out to replace all of your goods and belongings.

Insurance Caps

Some homeowner’s insurance policies also have specific caps on them for certain types of losses. If the type of loss that you have incurred falls into one of these pre-defined areas, you may not necessarily get all of the money you need to rectify the situation – even if your homeowner’s insurance policy is valued at much more.

Mold remediation, for example, is usually capped at $0, $5000 or $10000. If you suffer $20000 worth of damages, have a one million dollar homeowner’s insurance policy but a $10000 cap on mold remediation, you would only receive the capped amount of money and not a dollar more.How much do Insurance Claims Costs?

Sewer drain backups are also a common category that are usually capped by insurance providers. These are sometimes (but not necessarily always) capped at values like $1000, $5000 or $10000.

If these types of situations are of serious concern to you, it may be worth looking into a different policy that will provide a larger amount of coverage in the event that these types of situations do occur.

Deductible Costs

Most of the time, however, the homeowner will only be responsible for the cost of the deductible. If you suffer one million dollars worth of damage and have a two million dollar homeowner’s insurance policy with a $5000 deductible, you will only have to pay $5000 to completely replace your home in the event that the disaster fell into an uncapped situation. Your homeowner’s insurance will take care of the rest.

As it relates to pricing for the actual project, restoration companies are required to use a price list called Xactimate. This price list helps ensure that restoration companies are following a “fair” price list that is approved by all insurance companies. The scope of work may vary slightly from restoration company to restoration company, however the line item prices should always be the same. It is important to keep in mind that every project is going to be different and a “baseline” quote cannot be provided on the phone. The job must be assessed by a technician before any kind of pricing can be providedExternal Link:..


What Are the Benefits of Insurance Claims?

Many people are hesitant to file insurance claims for a wide variety of different reasons, even when it is the most best and logical step to take in a particular situation. Some people don’t want to deal with the sometimes lengthy and involved process of filing a claim in the first place and dealing with an insurance adjuster after they’ve already dealt with some type of disaster. Others are afraid that their insurance premiums will go up. Despite these very real issues, filing an insurance claim still brings with it a wide variety of different benefits that cannot be ignored.

Benefit:  The job gets done right

One of the biggest benefits of filing an insurance claim comes by way of the fact that it allows a restoration company to do their job 100% correctly thanks to having access to all of the funds required given the situation. The issue of “cost” is not a concern at all, as your insurance company is paying for the issue – regardless of the extent of the damage that you saw.What are the benefits of Insurance Claims?

Along the same lines, another benefit is that making a claim allows a restoration company to adhere to all standards that need to be followed given a situation. Not only do local building codes need to be followed when all types of restorations are performed, for example, but there are also many safety standards that need to be followed to a proverbial “T.” These standards can easily be followed without a question of cost. For more information about restoration standards, see our “Restoration Standards” page on our website.

Benefit:  Financial means are not an issue

Another major benefit of filing an insurance claim is the peace of mind that only comes with knowing that the concern of both cost and exceeding a certain dollar amount is not an issue. If it costs $5000 to fix the issue that you’re experiencing, your insurance company has you covered thanks to the claim. The same is true of a $10,000 bill, a $20,000 bill or higher.

Many people also don’t realize that unexpected additional damages may be found during the mitigation and restoration process. Filing a claim brings with it the benefit that these types of unexpected issues can be adequately addressed without needing to both stop work and receive financial approval from the homeowner. If you’re paying for restoration services out of pocket, $5,000 in additional work can be a large issue. If the funds are coming from your insurance company, all of these unexpected issues can be addressed quickly and in the best way possible.

What are the benefits of Insurance Claims?Many times after suffering some type of disaster like a fire, homeowners are very concerned with the cost. If you’re paying for the cost of restoration out of your own pocket, restoration companies are essentially limited on the services that they can provide with the money that they have available to them. After filing an insurance claim, however, restoration companies can work to the fullest extent of their natural abilities without having to worry about these types of concerns.

At the end of the day, It is important to realize that a homeowner takes out an insurance policy for a reason. It is to insure against catastrophes. You pay premiums for your entire life to guard against situations exactly like these. It would be a shame not to use that resource if you have it available – some people aren’t so lucky...