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How to Analyze Insurance Documents in a Fire Investigation:
Proof of Loss

Joseph Toscano
VP, Fire Investigation Specialist
American Re-Insurance Co.

The Proof of Loss is the document that reports the official communication from the insured that an insured property has been damaged. It details the property involved, the way it was damaged, the amount of damage, and condition of the property at the time of damage. It can be a valuable tool in establishing how the insured represented the loss to the insurance company, the entity that will determine what, if any, financial compensation will come to the insured.

Annotations are found below the form. You may click on any number on the form to hop directly to its annotation.

1. This section contains all of the information about the fire loss in the insured's own words: what happened, when it happened and why it happened. A misstatement here may be admissible evidence of fraud.

2. Information about the use and occupancy of the property at the time of the fire may be a significant indicator of a motive for the loss, particularly where a property has become vacant or unoccupied.

3. The legal interest of the insured is a statement of the insured's legal relationship to the property: ownership, leasehold, or other. It requires a disclosure of any other persons or entities having any legal interest in the property.

4. This section requires the disclosure of any changes in the insured's legal interest in the insurance policy since it was originally issued and any changes in the nature of the property insured since that time. This is critical information in considering the issue of motive, especially when coverage has been increased or the property has been significantly modified.

5. This requires a statement of the total available insurance, including coverage under any other policies previously disclosed or undisclosed. It may identify additional evidence of motive, especially in the case of a property where multiple policies are held that add up to a significant dollar value.

6. This is the insured's statement of the actual cash value (market value) of the insured property immediately before the fire loss. An overstatement of the value may correspond to an attempt to overstate the loss in a fraudulent claim.

7. This is the insured's statement of the total loss to the insured property, regardless of the limitations of insurance coverage. If the claim is fraudulent, the loss will likely be overstated. You may be able to provide a "reality check" for this figure with the damage you observed at the scene and the statements the insured made to you.

8. This represents the insured's definitive statement of the amount claimed under the policy, subject to any coverage limitations. If the claim is fraudulently overstated, it will appear here.

9. This paragraph contains a sworn representation by the insured that nothing about the loss and the resulting insurance cliam have been fraudulently misstated in any respect. Where the evidence proves otherwise, this is an admissible statement of the insured at trial.

10. The signature of the insured under oath establishes the admissibility of the proof of loss as evidence at trial.

11. The requirement that the Proof of Loss be sworn and notarized is a condition of the policy of insurance and confirms its admissibility as evidence at trial.

Reprinted with permission from the author.

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