Is Eleven Months Too Long a Delay in Filing a Claim with an Insurer After a Loss?

With cold temperatures gripping my home State of New Jersey, my mind (and research) brings me to warmer locations. In a recent case,¹ a federal court in Georgia held that an insured’s 11-month delay in filing a claim after a loss was not justified and provided the insurer with a reasonable ground to deny the claim.

In that case, the insured’s residence was substantially damaged during a fire in November of 2018. Plaintiff thereafter filed a claim with his insurer for damages from the fire in October of 2019. The insured claimed that he waited so long to file a claim with his insurer because of substance abuse issues that affected his memory, and that he was in such a distraught state of mind following the fire that he could not recall who his insurer was.

After conducting its investigation, the insurer denied the claim for failure to comply with the “immediate notice” provision in the policy.

In the ensuing litigation for breach of the insurance contract, the trial court ultimately granted summary judgment to the insurer-finding that the insured violated a condition precedent of the policy to provide the insurer with “immediate notice” after a loss without sufficient justification for the delay.

In making its finding, the court rejected the following contentions of the insured that he believed demonstrated justification for his failure to give notice according to the terms of the policy:

1. The “totality of the circumstances” for the insured in dealing with the effects of a recent divorce, aftermath of a foreclosure and struggling with substance abuse issues.
2. The insured’s claim that he “forgot” his insurer’s identity and did not have physical possession of his policy.
3. The insured’s alleged reliance on a telephone conversation with his mortgage company where he was allegedly advised that he had no insurance coverage.

This case underlies the importance of giving an insurer timely notice of a claim after a loss. If you are unsure as to the deadline for providing notice of a loss for your claim, check your policy. It should be noted that other states (such as New Jersey) require an insurer to show it has been prejudiced to relieve itself of liability for the insured’s breach of the notice provision. Click here for more information and a timeline for the claim process after a loss.
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¹ Currie v. Auto-Ins. Co., No. 1:20-CV-02160, 2021 WL 4354188 (N.D. Ga. Aug. 12, 2021).