What to Do if the Insurance Company Denies Compensation After the Palisades Fire

If your insurance company has denied your claim for Palisades Fire damage, don’t panic. A denial doesn’t mean the end of your claim—it simply means you may need to take additional steps to fight for the compensation you deserve.

The Palisades Fire, which burned 23,707 acres and destroyed thousands of properties in January 2025, left many homeowners and businesses facing significant financial losses. Unfortunately, some insurance companies are now rejecting valid claims, leaving victims unsure of what to do next.

Skilled Palisades Fire lawyers can help in this situation. They can review your policy, challenge the denial, and guide you through the appeal process to help you secure the compensation you need to rebuild.

In this guide, we’ll discuss why insurance companies deny claims and what you can do to fight back.

Common Reasons Insurance Claims Are Denied

Insurance companies deny claims for several reasons. Understanding why your claim was rejected can help you prepare a stronger appeal. Here are some common reasons for denials:

1. Lapse in Coverage

If your policy was not active at the time of the Palisades Fire, or if you failed to pay your premiums on time, your claim may be denied.

To avoid this issue, make sure to keep up with payments and renew your policy before it expires. If you are struggling financially, contact your insurance company to discuss possible payment plans or extensions.

2. Lack of Evidence

Insurance companies require evidence to support your claim. This includes photos, videos, receipts, and other documents that prove the extent of your losses.

If you did not provide enough evidence or if there are discrepancies in the information provided, your claim may be denied. Make sure to document all damages and losses thoroughly and provide accurate information when filing a claim.

3. Exclusion Clauses

Many insurance policies have exclusion clauses that limit coverage for certain types of losses. For example, your policy may not cover damages caused by wildfires or natural disasters.

Carefully review your policy to understand what is covered and what is excluded. If you believe your claim should be covered despite an exclusion clause, consult with a lawyer who can help argue your case.

Steps to Take if Your Claim is Denied

If your insurance company denies your Palisades Fire claim, here are some steps you can take:

• Review the Denial Letter: Carefully read the insurance company’s explanation. Identify the specific reasons for the denial and gather related documents.
• Gather Additional Evidence: Collect more evidence to support your claim. This may include repair estimates, damage photos, receipts for repairs, and correspondence with the insurance company.
• Request a Reconsideration or Appeal: Most insurers allow policyholders to request a reconsideration or file a formal appeal. Follow the instructions provided in the denial letter and submit the necessary paperwork within the required time frame.
• Consult an Attorney: If the insurance company refuses to reconsider your claim or continues to delay payment, legal help may be necessary. An experienced Palisades Fire lawyer can help you understand your rights and options for pursuing compensation.

Legal Protections for Policyholders in California

California law offers protections to policyholders who face bad faith practices from insurers. Under California Insurance Code §790.03(h), insurance companies are prohibited from:

• Unreasonably denying claims without a proper investigation
• Failing to communicate with policyholders about their claims
• Delaying payment without just cause

If your insurer acted in bad faith, you may be entitled to additional compensation beyond your initial claim.

When to Take Legal Action

If the insurance company remains uncooperative despite your efforts, filing a lawsuit might be the next step.

Wildfire-related claims can be complex, especially when insurance companies try to minimize payouts. An experienced attorney can help you build a strong case, present evidence, and fight for your right to compensation.

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