Loss Settlement Values and Date of Loss

November 22, 2010

We are an Illinois public adjusting firm and have a loss with State Farm which took place in March of 2009. The loss is still being adjusted with their first offer of approximately $270,000.00 tendered in July of 2009. In September of 2010 they submitted another offer of approximately $326,000.00 plus code changes of about $40,000.00. All pricing is based on the original date of loss in March of 2009. We feel we are entitled to 2010 prices. Is there any precedent for this?

 Illinois Subscriber

The problem is that prices are apt to go either up or down, and not always up. With the decline in the housing market contractors are dying for work; chances are they'll take less now than they would have a few years ago. The only fair way to handle this is to pay the claim as of the time of the loss; that's when the event occurred, and that's what should be due. I was unable to find any legal precedents for this type of situation.

This premium content is locked for FC&S Coverage Interpretation Subscribers

Enjoy unlimited access to the trusted solution for successful interpretation and analyses of complex insurance policies.

  • Quality content from industry experts with over 60 years insurance experience, combined
  • Customizable alerts of changes in relevant policies and trends
  • Search and navigate Q&As to find answers to your specific questions
  • Filter by article, discussion, analysis and more to find the exact information you’re looking for
  • Continually updated to bring you the latest reports, trending topics, and coverage analysis