Sworn Proof of Loss and a Late Contents Inventory
A condominium owner in Stamford reports a sudden pipe break that damaged flooring, cabinets, and personal property. The insurer sends a reservation-of-rights letter and requests a sworn proof of loss by April 1, stating that the policy requires it within 60 days. The public adjuster receives the letter on April 3. The insured gives the adjuster photographs, mitigation invoices, and a contractor estimate for $68,000. The contents are harder: some receipts are in a storage unit, and the insured is still cataloguing items. On May 20, the adjuster submits the building estimate and a 40% contents inventory, with a written note that the remaining inventory will follow. The insurer denies the entire claim on June 10 for failure to submit a complete proof of loss within 60 days. The denial letter does not identify any prejudice or missing item.
1. Is the insurer’s blanket denial for late proof of loss enforceable?
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A proof-of-loss provision is a condition of the policy, but a blanket denial is not automatically enforceable. The adjuster should compare the policy language with the insurer’s request and the actual timeline. The insurer requested the proof by April 1; the PA received the letter on April 3 and submitted a partial proof with a written explanation on May 20. The insurer then waited until June 10 to deny, without identifying what was missing or how it was prejudiced. Connecticut’s unfair claim settlement practices rules require a reasonable investigation, clear communication, and a good-faith basis for denial. A denial based solely on a missing portion of contents, where the insured is cooperating and has supplied substantial documentation, is vulnerable. The PA should demand the specific policy language, request an extension, and submit a supplemental sworn proof. The PA should preserve the appraisal clause for amount disputes, but appraisal does not decide coverage.
2. What should the PA do in the next ten days?
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The PA should send a written response disputing the denial and requesting a written extension of the proof-of-loss deadline. The response should include the dated proof-of-loss request, the April 3 receipt, the May 20 partial submission, and the explanation for the missing contents records. The PA should supplement the claim with a room-by-room inventory, photographs, purchase records that are available, and a sworn statement from the insured. The PA should also ask the insurer to identify exactly what it contends is missing and how the missing items prejudice its investigation. If the insurer refuses to reconsider, the PA should document the file for a Connecticut Insurance Department complaint and advise the insured of appraisal and legal options. The PA should not let the dispute stop mitigation or repairs that the policy requires.
3. How should the PA document the contents when receipts are incomplete?
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The PA should not inflate the inventory to make up for missing receipts. The PA should use room-by-room inventories, photographs, video, credit-card and bank records, vendor replacement quotes, and the insured’s sworn statement. For each item, the PA should record age, condition, original cost if known, replacement cost, and actual cash value. The PA should separate items that are undamaged, damaged, and claimed as a total loss. If the insured cannot prove ownership of an item, the PA should disclose that weakness rather than present it as fully documented. The goal is a defensible proof of loss that supports the insured’s good faith and avoids a later misrepresentation allegation.