If you’ve had a devastating fire at your home or business, you are probably primarily concerned with cleaning up, rebuilding, and getting things back to normal as quickly as possible. If you had the good sense to purchase an appropriate policy of insurance for your home or business, you have bought and paid for peace of mind.
But sometimes after large losses your insurance company may not be so quick to come to your aid. Some insurance companies in our experience will refer your claim to what is often referred to as a “Special Investigation Unit” for no other reason than because you suffered a “large loss” – a big fire that destroyed most or even all of your property.
Traditionally, the “Special Investigation Unit” (often called the “SIU” for short) was a tool used by insurance companies to investigate suspected fraud or malfeasance on the part of an insured or someone connected with an insured. Insurance fraud does occur, and insurance companies are not required to pay fraudulent claims. However, the unfortunate practice of some companies of referring large losses to the SIU for no reason other than that they are large losses has caused a great deal of grief for many victims of devastating fires who are innocent of any wrongdoing. SIU investigators in our experience often fail to recognize that their investigations can cause substantial harm to insureds already suffering from a devastating loss by subjecting them invasive and demeaning investigative procedures and heightened scrutiny they do not deserve, and/or by causing needless delay in the payment of valid claims. Many SIU investigators are retired police officers or others with law enforcement backgrounds who are not adequately trained in the duty of good faith and fair dealing that insurance companies owe their policyholders. This lack of training tends to compound the problems faced by innocent victims of large fire losses because the SIU investigator does not take the needs and interests of the insureds into account.
When an insured learns that the SIU has been assigned his or her claim, it is important to obtain competent representation as soon as possible. The insured has the right to be treated fairly during the claims process, and an attorney experienced in handling policy disputes is, in our opinion, in the best position to prevent the involvement of the Special Investigation Unit from causing the insured greater harm.