FIRST-PARTY PROPERTY DAMAGE DEMAND LETTER

[LAW FIRM LETTERHEAD]

PRIVILEGED AND CONFIDENTIAL
SETTLEMENT COMMUNICATION - FOR RESOLUTION PURPOSES ONLY
PROTECTED UNDER [STATE] RULE OF EVIDENCE [___] AND F.R.E. 408

VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED
AND VIA EMAIL TO: [ADJUSTER_EMAIL]

Date: [DATE]

[INSURANCE_COMPANY_NAME]
[PROPERTY_CLAIMS_DEPARTMENT_ADDRESS]
[CITY], [STATE] [ZIP]

Attention: [ADJUSTER_NAME], [ADJUSTER_TITLE]
Re: FORMAL DEMAND FOR PROPERTY DAMAGE CLAIM PAYMENT
Insured: [INSURED_NAME]
Property Address: [PROPERTY_ADDRESS]
Policy Number: [POLICY_NUMBER]
Claim Number: [CLAIM_NUMBER]
Date of Loss: [DATE_OF_LOSS]
Type of Loss: [LOSS_TYPE - e.g., Fire, Water, Wind/Hail, Theft, etc.]
Coverage Limits: [COVERAGE_LIMITS]
Response Deadline: [RESPONSE_DEADLINE]

Dear [ADJUSTER_NAME]:

I. INTRODUCTION AND NATURE OF DEMAND

This firm represents [CLIENT_NAME] ("our client") in connection with the above-referenced property damage insurance claim. This letter constitutes a formal demand for payment of all policy benefits owed under the policy for covered losses sustained at [PROPERTY_ADDRESS].

After three decades of representing property owners against insurance companies, the pattern in this case is all too familiar: a legitimate claim, a covered loss, and an insurer that has [DELAYED PAYMENT/UNDERVALUED THE LOSS/DENIED COVERAGE WITHOUT JUSTIFICATION]. Our client purchased insurance to protect against precisely this type of loss. [CARRIER_SHORT_NAME] has failed to honor its contractual obligations.

This is a time-sensitive demand. If full payment is not received by [RESPONSE_DEADLINE], we will pursue all available legal remedies, including litigation for breach of contract, bad faith, and statutory violations, as well as complaints to the [STATE] Department of Insurance.

II. POLICY INFORMATION AND COVERAGE

A. Policy Details

B. Applicable Coverage and Limits

C. Applicable Endorsements

The following endorsements are relevant to this claim:

☐ [ENDORSEMENT_1] - [BRIEF_DESCRIPTION]
☐ [ENDORSEMENT_2] - [BRIEF_DESCRIPTION]
☐ [ENDORSEMENT_3] - [BRIEF_DESCRIPTION]
☐ Replacement Cost Endorsement
☐ Ordinance or Law Coverage
☐ Extended Replacement Cost
☐ Guaranteed Replacement Cost
☐ [OTHER_ENDORSEMENTS]

D. Coverage Analysis

The policy provides coverage for [DESCRIBE_RELEVANT_INSURING_AGREEMENT]. The insuring agreement states:

"[QUOTE_RELEVANT_POLICY_LANGUAGE]"

The loss at issue is clearly covered because:

1. The [PERIL/CAUSE_OF_LOSS] is a covered peril under the policy
2. The damage occurred during the policy period
3. The insured property is covered property
4. No exclusions apply to bar coverage
5. All policy conditions have been satisfied

III. THE LOSS EVENT

A. Description of Loss

On [DATE_OF_LOSS], at approximately [TIME_IF_KNOWN], the insured property at [PROPERTY_ADDRESS] sustained significant damage due to [DESCRIBE_LOSS_EVENT_IN_DETAIL].

[DETAILED_NARRATIVE_OF_LOSS_EVENT]

B. Cause and Origin

The cause of the loss was [IDENTIFY_CAUSE]:

☐ Fire (accidental/electrical/HVAC/other: [SPECIFY])
☐ Water damage (plumbing failure/appliance malfunction/roof leak/storm)
☐ Wind/Windstorm
☐ Hail
☐ Hurricane/Named Storm
☐ Tornado
☐ Lightning
☐ Theft/Vandalism
☐ Falling Objects
☐ Weight of Ice/Snow
☐ Freezing (pipes/systems)
☐ [OTHER_CAUSE]

[IF FIRE]: The [FIRE_DEPARTMENT/INVESTIGATOR] determined the fire originated at [ORIGIN_POINT] and was caused by [CAUSE_DETERMINATION]. The official report (Report No. [REPORT_NUMBER]) is enclosed.

[IF WEATHER]: The National Weather Service recorded [WEATHER_DATA] in the area on [DATE_OF_LOSS]. [ATTACH_WEATHER_DOCUMENTATION].

C. Emergency Response and Mitigation

Upon discovering the loss, our client took immediate steps to mitigate damage:

Our client fulfilled the policy obligation to protect the property from further damage. These mitigation costs are recoverable under the policy.

IV. CLAIM HISTORY AND INSURER'S RESPONSE

A. Claim Submission Timeline

B. Insurer's Position

[CARRIER_SHORT_NAME] has taken the following position on this claim:

☐ Partial Payment: The Company paid $[AMOUNT_PAID] but this represents only [PERCENTAGE]% of the actual loss

☐ Denial: The Company denied coverage based on [STATED_REASON_FOR_DENIAL]

☐ Delay: The Company has failed to timely investigate/evaluate/pay the claim

☐ Undervaluation: The Company's estimate fails to account for [ITEMS_NOT_INCLUDED]

☐ Depreciation Dispute: The Company applied excessive depreciation to [ITEMS]

☐ Scope Dispute: The Company refuses to include [ITEMS/REPAIRS] in the scope of loss

☐ Causation Dispute: The Company alleges the damage was caused by [EXCLUDED_CAUSE]

C. Problems with Insurer's Position

[CARRIER_SHORT_NAME]'s position is unreasonable and unsupportable for the following reasons:

[DETAILED_ANALYSIS_OF_WHY_CARRIER_POSITION_IS_WRONG]

V. DAMAGES AND CLAIMED AMOUNTS

A. Dwelling Damage (Coverage A)

Our client has obtained estimates from licensed, qualified contractors. The reasonable and necessary cost to repair/replace the damaged dwelling is:

Structural Damage:

Systems Damage (Electrical, Plumbing, HVAC):

Interior Finishes:

General Conditions and Overhead & Profit:

TOTAL DWELLING DAMAGE (Coverage A): $[TOTAL_DWELLING]

B. Other Structures Damage (Coverage B)

C. Personal Property Loss (Coverage C)

Our client has prepared a detailed personal property inventory documenting all damaged, destroyed, or stolen items:

A complete personal property inventory with photographs, receipts, and value documentation is enclosed.

D. Loss of Use / Additional Living Expenses (Coverage D)

Our client [HAS BEEN DISPLACED FROM/CANNOT FULLY USE] the property since [DATE_OF_LOSS]. Loss of use damages include:

[IF_RENTAL_PROPERTY]: Lost rental income: $[MONTHLY_RENT] x [MONTHS] = $[TOTAL_LOST_RENT]

E. Ordinance or Law Coverage (If Applicable)

Due to building code changes since original construction, our client must comply with current codes, which requires:

F. Emergency/Mitigation Expenses

G. Summary of Claim

VI. REPLACEMENT COST VS. ACTUAL CASH VALUE

A. Policy Provisions

The policy provides [REPLACEMENT_COST/ACV] coverage. [IF REPLACEMENT COST]:

Under the Replacement Cost provisions, our client is entitled to recover the full cost to repair or replace damaged property with materials of like kind and quality, without deduction for depreciation, subject to:

☐ Actual repair/replacement (if required by policy)
☐ Notification of intent to make replacement cost claim
☐ Completion within policy-specified time period

B. Depreciation Dispute (If Applicable)

[CARRIER_SHORT_NAME] withheld $[DEPRECIATION_WITHHELD] as "recoverable depreciation." The Company's depreciation calculations are improper because:

☐ Depreciation was applied to items that cannot be depreciated (e.g., labor)
☐ The depreciation percentages are excessive and unsupported
☐ The Company failed to consider condition immediately before loss
☐ [OTHER_DEPRECIATION_OBJECTIONS]

Under [STATE] law, [CITE_AUTHORITY_ON_DEPRECIATION], depreciation [CANNOT BE APPLIED TO LABOR/MUST BE REASONABLE/OTHER].

C. Replacement Cost Recovery Process

Our client hereby provides notice of intent to claim replacement cost benefits. Upon completion of repairs, we will submit documentation of actual costs incurred and demand payment of all recoverable depreciation withheld.

VII. OVERHEAD AND PROFIT

A. Entitlement to O&P

Our client is entitled to general contractor overhead and profit because:

☐ The repairs require coordination of multiple trades
☐ The scope and complexity of work exceeds simple handyman repairs
☐ A general contractor is reasonably necessary to complete the work
☐ Our client is not required to act as their own general contractor
☐ Industry standard for O&P is [___]% overhead and [___]% profit

B. [CARRIER_SHORT_NAME]'s Improper Denial

The Company has refused to include O&P in its estimate, claiming [CARRIER'S_REASON]. This position is contrary to:

☐ Industry standards (see IICRC, ANSI, building codes)
☐ [STATE] law and regulations
☐ The policy's promise to pay "reasonable and necessary" repair costs
☐ Basic fairness - the insured should be made whole

VIII. APPRAISAL DEMAND (IF APPLICABLE)

A. Policy Appraisal Provision

The policy contains an appraisal clause that provides:

"[QUOTE_APPRAISAL_CLAUSE]"

B. Demand for Appraisal

Due to [CARRIER_SHORT_NAME]'s failure to fairly evaluate this claim, we hereby invoke the appraisal process as provided in the policy.

We appoint [APPRAISER_NAME], [CREDENTIALS], as our client's appraiser.

Please provide the name of [CARRIER_SHORT_NAME]'s appraiser within [NUMBER] days as required by the policy.

C. Scope of Appraisal

The following items are submitted to appraisal:

☐ Amount of loss to dwelling (Coverage A)
☐ Amount of loss to other structures (Coverage B)
☐ Amount of loss to personal property (Coverage C)
☐ [SPECIFIC_DISPUTED_ITEMS]

Note: Coverage questions are not subject to appraisal and are reserved for litigation if not resolved.

D. State Appraisal Requirements

Under [STATE] law, [CITE_APPRAISAL_STATUTE_IF_ANY], the appraisal process must comply with the following requirements:

[STATE_SPECIFIC_APPRAISAL_REQUIREMENTS]

IX. STATUTORY VIOLATIONS AND BAD FAITH

A. Prompt Payment Statute Violations

[CARRIER_SHORT_NAME] has violated [STATE]'s prompt payment statute, [CITE_STATUTE], by:

☐ Failing to acknowledge the claim within [___] days (Deadline: [DATE]; Actual: [DATE])
☐ Failing to begin investigation within [___] days (Deadline: [DATE]; Actual: [DATE])
☐ Failing to accept/deny within [___] days (Deadline: [DATE]; Actual: [DATE])
☐ Failing to pay within [___] days of acceptance (Deadline: [DATE]; Actual: [DATE])
☐ Failing to provide written explanation for delay/denial

These violations entitle our client to:

☐ Statutory interest at [___]% per annum
☐ Statutory penalties of [DESCRIBE_PENALTIES]
☐ Attorney's fees
☐ [OTHER_STATUTORY_REMEDIES]

B. Unfair Claims Settlement Practices

[CARRIER_SHORT_NAME]'s handling of this claim violates [STATE]'s Unfair Claims Settlement Practices Act, [CITE_STATUTE]:

☐ Misrepresenting pertinent facts or policy provisions (Section [___])
☐ Failing to acknowledge and act promptly upon communications (Section [___])
☐ Failing to adopt reasonable standards for prompt investigation (Section [___])
☐ Refusing to pay claims without conducting reasonable investigation (Section [___])
☐ Failing to affirm or deny coverage within reasonable time (Section [___])
☐ Not attempting good faith settlement when liability is clear (Section [___])
☐ Compelling litigation by offering substantially less than amounts recovered (Section [___])
☐ Attempting to settle for less than reasonable person would expect (Section [___])
☐ Failing to promptly provide reasonable explanation for denial (Section [___])
☐ Requiring unnecessary/duplicative documentation (Section [___])
☐ [OTHER_VIOLATIONS]

C. Bad Faith Claim

Under [STATE] law, [CARRIER_SHORT_NAME]'s conduct constitutes actionable bad faith because:

[DESCRIBE_BAD_FAITH_CONDUCT_AND_APPLICABLE_STATE_STANDARD]

Available bad faith remedies include:

☐ Compensatory damages beyond policy limits
☐ Consequential damages
☐ Emotional distress damages
☐ Punitive/exemplary damages
☐ Statutory penalties
☐ Attorney's fees and costs

X. DEMAND

A. Monetary Demand

We hereby demand payment of $[TOTAL_DEMAND] as follows:

B. Replacement Cost Holdback

If [CARRIER_SHORT_NAME] insists on withholding recoverable depreciation pending actual repairs, we require:

☐ Immediate payment of ACV in the amount of $[ACV_AMOUNT]
☐ Written confirmation of recoverable depreciation amount: $[RCV_HOLDBACK]
☐ Clear instructions for recovering depreciation holdback
☐ Reasonable time period for completing repairs and claiming replacement cost

C. Additional Terms

☐ Payment to be made payable to [PAYEE_NAME(S)]
☐ If mortgagee is named, provide separate check for contents and ALE
☐ [OTHER_PAYMENT_TERMS]

XI. RESPONSE DEADLINE AND CONSEQUENCES

This demand must be accepted by 5:00 p.m. [TIME_ZONE] on [RESPONSE_DEADLINE].

A. If Accepted

If [CARRIER_SHORT_NAME] accepts this demand, payment should be sent to:

[LAW_FIRM_NAME]
[ADDRESS]
[CITY], [STATE] [ZIP]
ATTN: Trust Account - [CLIENT_NAME]

B. If Rejected or No Response

If [CARRIER_SHORT_NAME] fails to accept this demand by the deadline:

1. Litigation will be filed seeking:
   - All policy benefits owed
   - Statutory penalties and interest
   - Bad faith damages
   - Punitive damages
   - Attorney's fees and costs

2. Regulatory complaints will be filed with:
   - [STATE] Department of Insurance
   - National Association of Insurance Commissioners

3. We will invoke appraisal (if not already invoked) to establish the amount of loss

4. Discovery will be sought into:
   - [CARRIER_SHORT_NAME]'s claim handling practices
   - Similar claims files
   - Training materials
   - Adjuster metrics and incentives
   - Corporate policies on claim payments

C. Litigation Hold

This letter serves as notice to preserve all documents and ESI related to this claim. See detailed preservation requirements in Appendix A.

XII. ENCLOSED DOCUMENTATION

Policy Documents:
☐ Declarations page
☐ Relevant policy provisions
☐ Applicable endorsements

Claim Documents:
☐ Proof of loss (if submitted)
☐ Claim correspondence
☐ Adjuster reports/estimates

Damage Documentation:
☐ Photographs of damage (before and after)
☐ Video documentation
☐ Contractor estimates/bids
☐ Scope of loss documentation
☐ Personal property inventory

Expert Reports:
☐ Cause and origin report (if applicable)
☐ Engineering report (if applicable)
☐ Contractor scope review
☐ [OTHER_EXPERT_REPORTS]

Supporting Documentation:
☐ Fire department report
☐ Police report (if applicable)
☐ Weather data/reports
☐ Building permits
☐ Code compliance documentation
☐ Mitigation invoices
☐ ALE documentation
☐ [OTHER_SUPPORTING_DOCUMENTS]

XIII. CONCLUSION

[CARRIER_SHORT_NAME] sold our client a policy promising to protect against property losses. That loss has occurred. The coverage is clear. The damages are documented. The only thing missing is [CARRIER_SHORT_NAME]'s payment.

Our client has been patient throughout this process. That patience has run out. If [CARRIER_SHORT_NAME] does not resolve this claim fairly and promptly, we will pursue every available remedy to ensure our client receives what was promised.

We look forward to your response.

Respectfully submitted,

[LAW_FIRM_NAME]

By: _______________________________
[ATTORNEY_NAME]
[BAR_NUMBER]
[ADDRESS]
[CITY], [STATE] [ZIP]
[PHONE]
[FAX]
[EMAIL]

Counsel for [CLIENT_NAME]

ENCLOSURES: See Section XII above

CC:
☐ [CLIENT_NAME]
☐ [MORTGAGEE_NAME] (if applicable)
☐ [STATE] Department of Insurance
☐ [PUBLIC_ADJUSTER_NAME] (if applicable)
☐ [OTHER_PARTIES]

APPENDIX A: DOCUMENT PRESERVATION NOTICE

[CARRIER_SHORT_NAME] is hereby notified to preserve all documents and electronically stored information related to this claim, including but not limited to:

☐ Complete claim file (all versions)
☐ All internal communications (emails, IMs, voicemails)
☐ Adjuster notes, diaries, activity logs
☐ All photographs, videos, inspection reports
☐ All estimates (Xactimate files, etc.)
☐ All expert reports
☐ Reserve information
☐ Supervisor communications and approvals
☐ Quality assurance or audit documentation
☐ Claim handling guidelines and manuals
☐ Training materials
☐ Similar claims data
☐ All electronic data and metadata

APPENDIX B: STATE-SPECIFIC CONSIDERATIONS

IMPORTANT: Before using this template, research your jurisdiction:

☐ Prompt Payment Deadlines: What are your state's specific deadlines and penalties?

☐ Appraisal Requirements: Does your state have appraisal statutes? Is appraisal mandatory or optional? What are the procedures?

☐ Bad Faith Standard: What must be proven for first-party bad faith? What damages are available?

☐ Depreciation Rules: Can your state depreciate labor? What are the rules?

☐ O&P Requirements: Does your state have specific rules on overhead and profit?

☐ Replacement Cost Procedures: What are the requirements for claiming replacement cost?

☐ Notice Requirements: Are there pre-suit notice requirements?

☐ Statute of Limitations: What is the limitations period?

☐ Assignment of Benefits: Are AOB arrangements permitted in your state?

☐ Anti-Concurrent Causation: How does your state treat ACC clauses?