Guide · Partial payments
Underpaid insurance claim in Israel
A payment lower than the damage is one point where a property claim can stall. This guide explains where the gap tends to form and how an underpaid claim is reviewed, line by line.
Adv. Sassi Lev
Insurance claims and property damage
What an underpaid insurance claim looks like
An underpaid insurance claim in Israel may arrive as a payment notice or a transfer to your account, with a short explanation or none. The amount is lower than the assessment, lower than the repair quotes, or lower than what the policy seemed to cover.
A partial payment is not necessarily wrong. But each deduction should have a reason that can be traced to the policy or to the assessment. Where it cannot, the payment can be reviewed.
The questions are practical. Which items were reduced? By how much? On what basis? Once those are answered, it becomes clear whether the dispute is about the policy, the assessment or the calculation.
Where the gap usually forms
Deductions tend to fall into a few groups. Each one is checked against a different document.
In car claims, a gap may appear in parts and labor. In home and business claims, it may appear in contents, stock and the scope of repair. In each case, the assessor's report and the repair quotes are the documents to compare.
- Depreciation or wear and tear deducted from parts, contents or materials
- Price lists the insurer applied instead of the actual repair cost
- The deductible (excess) set in the policy schedule
- Underinsurance: an insured sum lower than the real value, which can reduce the payment proportionally
- Items the insurer says are outside the coverage or were not proven
- A narrower scope of repair than the damage requires
How the payment is reviewed line by line
We compare the payment with the assessor's report, the repair quotes and the policy, item by item. The aim is to see exactly which items were reduced, by how much, and on what stated basis.
The insurer's assessor's report is a professional opinion, not a ruling. Where the report itself is the problem, a counter-report by an independent assessor appointed by the policyholder may be considered. The dispute is then between two professional opinions, and each is tested against the documents.
Where a deduction is not explained, the insurer can be asked in writing to explain it. The answer can narrow the dispute.
Underinsurance and replacement value
If the insured sum in the policy is lower than the real value of the property, the payment can be reduced proportionally. This can happen with contents and building insurance that was not updated for years.
Whether the payment is based on replacement (reinstatement) value or on value after depreciation depends on the policy wording and its conditions. The policy schedule and the extensions purchased are the place to start. Read more about home insurance claims and commercial property claims.
Underinsurance does not show clearly in every payment notice. It can appear as a single reduction without explanation, and it is worth asking the insurer to show the calculation.
Before you accept a low offer
A release and discharge form may come with the payment. Signing it usually closes the claim, including the parts you may disagree with. It is worth checking what the form says before you sign, not after.
An insurer is generally expected to pay benefits that are not in dispute within 30 days. Where one part of the claim is disputed, the undisputed part is still generally expected within that period.
The limitation period for an insurance claim is generally three years from the insured event. Some situations differ, so the date should be checked early.
Before accepting, it helps to have a short written list of the disputed items and the amounts involved. That list is also the starting point for any written response to the insurer.
What to send
Send the payment notice, the assessor's report, the repair quotes and the policy on WhatsApp to +972-55-989-3839. We compare them and come back with what was checked and the next step. We work in English or in Hebrew, and remotely if needed.
If the insurer has refused part of the claim outright, see also what to do when an insurance claim is denied and the main guide to property insurance claims.
Questions people ask
The insurer paid less than the assessor's report. Is that allowed?
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Each deduction generally needs a reason that can be traced to the policy or the assessment. Compare the payment with the report item by item, and ask the insurer to explain in writing any deduction that is not clear.
Should I sign the release form to receive the payment?
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Check it first. A release and discharge form usually closes the claim, including the parts you may disagree with. The wording and its effect should be reviewed before signing.
What is underinsurance?
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It is when the insured sum is lower than the real value of the property. In that case the payment can be reduced proportionally, depending on the policy wording.
Can I obtain my own assessor's report?
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Yes. A policyholder may obtain a report from an independent assessor. It becomes a second professional opinion that is compared with the insurer's report.
Have a document from the insurer?
A denial letter, a payment notice or an assessor's report. Send it on WhatsApp and we will come back to you with the next step.
Sending material does not create an attorney–client relationship.