Sometimes you shouldn’t try to fight insurance company

Question: We had problems with our roof during a major monsoon storm last summer in Chandler. Our entire master bedroom was flooded, including closets with our clothes. The cost of roof repairs and replacement of our clothing was over $40,000. The problem now is that last year we refinanced our home mortgage, and our new insurance company has denied our claim because we apparently completed the wrong paperwork. We hired a lawyer who filed a lawsuit against our new insurance company. The lawyer for our new insurance company then called our lawyer to say that, although our new insurance company had no liability, the settlement offer was $25,000 ‘take it or leave it,’ and there will be no more settlement offers. We already have paid almost $10,000 to our attorney. What should we do?

Answer: Although I have no idea if you or your new insurance company would ‘win,’ I have some comments. First, justice in the Arizona court system, and in any court system, is not only expensive, but problematic. Second, you have already spent almost $10,000 on legal fees, and the multibillion-dollar insurance company hasn’t even answered the lawsuit. In other words, like the old Carpenters song, ‘We’ve Only Just Begun.’ Finally, even if you spend more than $150,000 in legal fees and you ‘win’ at the jury trial at least two years from now, the judge, not the jury, determines the amount of legal fees awarded to you, e.g., the judge may not agree with the jury’s verdict and may award you no legal fees.

Bottom line: You should accept the $25,000 settlement offer, and put the ‘net’ $15,000 in your bank to at least have the roof permanently repaired.