Homeowner’s insurance covers both property loss and claims against the homeowner for accidents that occur on the property. This article discusses the requirements for properly submitting a claim based on an injury on the property, when the accident was caused by the homeowner’s negligence.
Insurance Company Must be Notified of Accident as Soon as Practicable
The provision in a home owner’s insurance contract providing coverage for accident liability to others contain very strict “notice” requirements. Under these notice requirements, the home owner must notify the insurance company of the accident “as soon as practicable.”
What counts as “as soon as practicable” depends on the circumstances, but it generally means what it says, i.e. the first opportunity the homeowner has to notify the insurance company. If the home owner waits too long the insurance company may be able to deny coverage.
Some states require the insurance company to prove that it was “prejudiced” by the late notice before it can deny coverage, i.e. that proper notice would have given it a better chance to investigate and defend the accident claim in court. Other states do not require prejudice — failing to comply with the accident notice requirements is fair grounds to deny the claim regardless of other factors.
Note that if the homeowner could not have reasonably known about the accident until a lawsuit is filed, the failure to file a notice of accident cannot legally lead to a denial of coverage in any state.
Information Generally Required in Accident Notice
Although the requirements of particular home owner’s insurance policies may vary, the homeowner is usually required to provide:
- the identity of the person who owns the policy, and the policy number
- a description of how the accident happened, as well as place and time
- the name and address of the injured person
- the name and address of any witnesses, and
- a description of the damage and injuries caused by the accident.
The homeowner should consult the policy and/or contact the insurance company to determine what, exactly, is required to satisfy the notice of accident requirements.
If the homeowner’s insurance broker is an authorized agent of the insurance company, providing notice to the broker is usually sufficient. However, it is always safest to consult the policy to determine the best person to notify. Keep records of the attempts to notify the company and use certified mail for any correspondence.
Insurance Company Must Be Notified of Lawsuit Against Homeowner
Even if the homeowner properly notified the insurance company of the accident, he or she must also notify the insurance company if the injured person sues the homeowner.
Along with notifying the insurance company of the suit, the homeowner typically is also required to send along to the insurance company all documents related to the lawsuit, such as the complaint and demands for damages.
As with notice of the accident, whether the notice of suit is late depends on the facts and circumstances, but the homeowner is required to make the notice of suit “immediately” or “as soon as practicable.” Whether the insurance company must have been “prejudiced” by the late notice also varies from state to state.
Aside from giving notice and providing litigation-related documents, the homeowner is required by the policy to cooperate with the insurance company. This typically includes:
- filling out all forms provided by the insurance company
- preserving evidence that is relevant to the case and securing any evidence requested by the insurance company
- showing up in court or at deposition when requested to do so, either by the company or by the court, and
- generally participating in and facilitating claim settlements and court cases as requested.
Not All Claims Are Covered by Homeowners’ Insurance
Keep in mind that some kinds of accident claims are not covered, even though the accident occurred on the homeowner’s property. Excluded claims include:
- harm caused by intentional acts, including sexual abuse
- harm caused during the provision of professional services or business activities
- harm caused by automobiles, and
- harm caused to residents of the household, relatives/family members, and children in the care of the homeowner.
Types of Coverage
Homeowners liability insurance policies usually include third party coverages for the following claims:
- Medical payments to others. This form of liability insurance pays for the medical expenses incurred by people for injuries sustained in your home or property, without regard to the fault of the injured person or you.
- Personal liability insurance. This form of liability insurance provides coverage for personal liability for bodily injury or property damage. This policy protects against accidents that result in bodily injury, sickness, or disease (i.e., a guest slips in the bathroom) or property loss or damage (i.e., your child hit a baseball through the neighbor’s window). This type of coverage usually covers the homeowner and his or her spouse, relatives, and other household residents under their care.
- Residential employees insurance. Homeowners liability insurance may provide workers’ compensation and employers’ liability coverages for employees of a house, such as maids, nannies, and adult caregivers. This usually does not extend to repair persons, such as a plumber or carpenter, because they are generally not employees, but independent contractors.
- Umbrella policies. An umbrella policy is a type of coverage that you purchase on top of another coverage. Essentially, it provides you with additional coverage in excess of the underlying coverage. However, before the umbrella policy comes into effect, the underlying primary policy usually must be exhausted. So, if you have purchased the umbrella policy from a different insurance company than the primary policy, the primary insurance company has a duty to defend you against lawsuits until the primary coverage is exhausted. Umbrella policies may also provide coverage for losses not covered by the underlying policy. In this situation, you would not need to exhaust the primary policy.