By SPJ Adjusting Services | Insurance Appraisals
Insurance policies are usually complicated and involve stern adherence to set requirements by the policyholder. One of the most influential of these provisions is the forfeiture clause: a rule that allows insurance companies to decline coverage on grounds of non-fulfilment of certain policy conditions.
But here is the big question: whether forfeiture is always final, or sometimes it can be waived?
Now, let’s break it down in simple terms.
What Is a Forfeiture Clause?
A forfeiture clause in an insurance policy basically states the following:
Failure to do so might lead to the loss of your right to coverage under the policy.
In other words, even if one has an active policy, the insurer can deny a claim if one breaks certain rules or misses key deadlines.
Common examples of forfeiture triggers include:
• Failure to submit a Proof of Loss in due course
• Failure to provide documentation requested in the course of an investigation
• breech of policy conditions, failure to maintain requisite protective safeguards such as smoke alarms, security systems
These clauses often serve as the basis on which insurance companies deny claims or even delay them, even when the mistake was negligible and unintended.
Can Forfeiture Be Waived?
Yes-and that is where things start to get interesting.
The courts have long recognized that an insurer may in certain circumstances waive entitlement to rely upon the forfeiture rule. In summary, waiver occurs where the insurer’s own acts are inconsistent with the strict maintenance of policy conditions.
For example, forfeiture might be waived if the insurer:
• Continues to accept premium payments after knowing of a breach
• Keeps on negotiating or adjusting the claim when deadlines have passed.
Fails consistently to enforce the requirements; some policyholders get treated differently.
In such cases, the courts usually favor the policyholder by ruling that the insurer can’t later rely on forfeiture after acting like coverage was still in place.
Real-World Example
Let’s say a property owner misses the 60-day Proof of Loss deadline after a fire. Normally, that could trigger forfeiture. But if the insurance company continues communicating, requests inspections, and negotiates settlement terms afterward, it may have implicitly waived the forfeiture defense.
That means the policyholder may still be entitled to coverage-even though the deadline was missed.
Why It Matters for Property Owners
Forfeiture issues are most prevalent in property damage claims in the aftermath of significant events such as windstorms, fires, hailstorms, or floods.
It seems that too many property owners in El Paso, TX, and throughout the U.S. think missing a deadline or failing to meet a policy’s technical condition instantly kills their claim.
But that’s not always true.
An experienced insurance appraiser or public adjuster will be able to review your policy, the insurer’s behavior, and the timeline of the claim to see if waiver or estoppel arguments apply. These legal defenses can often reopen coverage that the insurers initially denied.
SPJ Adjusting Services’ Perspective
In SPJ Adjusting Services, we’ve encountered numerous instances in which insurers took advantage of the forfeiture clause through unfair means. We at SPJ Adjusting Services will do all it takes to prevent a policyholder from being deprived of his or her insurance coverage simply because of technical issues.
Here’s how we help:
• Comprehensive policy review: We carefully evaluate the policy language and the claim file for any potential waiver or estoppel issues.
• Strategic Claim Arguments: We construct solid, evidence-based arguments for challenging wrongful forfeitures.
• Fair Coverage Enforcement: We ensure insurers honor the policyholder’s rights and deliver the coverage that was paid for.
Our team has extensive experience in handling insurance appraisals, umpire services, and claim disputes all over the United States.
Final Thought
A forfeiture clause does not always mark the end of one’s claim. Expert review and strategic advocacy can revive waiver arguments and coverage, insulating one from unfair denials.
If you feel that your insurance company has denied your claim based on a forfeiture clause unfairly, do not give up yet. Let a qualified professional review your case before you walk away from coverage you may still deserve.
Contact SPJ Adjusting Services
We’re here to help policyholders nationwide understand their rights and get the settlement that’s rightfully theirs.
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