Allstate accepted an appraisal on hail damage, then refused to pay the $332,416 award, citing an engineer's report the homeowners say was fundamentally flawed.
New Mexico homeowners Nickolaus and Crista Wiegel are suing Allstate Vehicle and Property Insurance Company in federal court, alleging the insurer manipulated the claims process by applying the wrong coverage standard to deny payment for storm damage to their Clovis property.
According to the lawsuit filed November 10, a severe hailstorm struck the Wiegels' home on May 24, 2023. The National Weather Service's Storm Prediction Center reported significant winds that caused walls to collapse and damaged roofs in Clovis, with ground-spotters measuring 2-inch hailstones at ground level. The next morning, the Wiegels found broken concrete roof tiles on the ground and washing out of downspouts, along with damage to window frames, skylights, garage doors, and vinyl siding.
What followed, the lawsuit alleges, was a prolonged ordeal marked by conflicting assessments and strategic delays.
When the first adjuster inspected the property on June 20, 2023, he told Mr. Wiegel he could see the damage and would write an estimate for all of it, including replacement of the concrete roof tiles. Hours later, the same adjuster personally came by Mr. Wiegel's office with different news: a claims manager who was not at the inspection had determined the damage to the roof, windows, and garage doors was not caused by hail.
A second adjuster arrived in late October or early November 2023, about five months after the Wiegels reported the loss, but also declined to get on the roof. On November 2, 2023, Allstate issued a supplemental payment of $6,448.21 for damage above the policy's deductible, falling short of the contractor's $262,131.77 estimate.
The case centers on how Allstate's forensic engineer evaluated the damage. Gabriel Alexander, P.E., of US Forensics spent about 20 minutes inspecting the property on November 16, 2023. Mr. Wiegel showed him broken tile pieces that had been on the ground the morning after the storm and provided photographs his contractor had taken of broken tiles. Yet Alexander's report, containing just 12 photographs, concluded "no shattered tiles were observed and no damage to the tiled slopes, attributable to hail or wind driven debris was noted."
The Wiegels argue Alexander applied an improper standard. His report stated that laboratory testing for functional damage to various roofing materials from hail impacts indicates the lower threshold for functional damage to concrete tile is a 1.50-inch diameter hailstone, and that "Hail damage to roof tiles results in a shattered tile." The lawsuit contends this "functional damage" threshold contradicts the policy's actual terms.
Their policy includes endorsement AVP313, titled "Metal Roof Surfaces Cosmetic Damage Exclusion Endorsement," which excludes "Cosmetic damage caused by hail to the surface of a metal roof, including but not limited to, indentations, dents, distortions, scratches, or marks that change the appearance of a metal roof." Because the Wiegels' roofing system was and is concrete tile, not metal, they argue the cosmetic-versus-functional distinction shouldn't apply. By limiting coverage to "shattered tiles," the lawsuit alleges, Allstate improperly narrowed what the policy covers.
On December 26, 2023, relying on Alexander's report, Allstate sent the Wiegels a denial letter stating "there is no storm damage to the roof from this event" while adding "[T]his letter only applies to the roof for which coverage is being denied. We will continue to work with you to evaluate your other damages."
On March 14, 2024, nearly ten months after the loss, Mr. Wiegel invoked the policy's appraisal provision. One week later, Allstate accepted, stating it "expects the appraisal to determine the amount of loss attributable to wind/hail on 5/24/2023" at the property. The appraisal panel completed its work on August 4, 2024, almost fourteen months after the storm, when the Wiegels' appraiser and the umpire signed the award. It set the replacement cost value at $332,416.12 for the dwelling and $792.24 for other structures.
On October 10, 2024, Allstate sent payment of $88,599.05, leaving $233,161.10 unpaid after application of the policy's deductible and subtraction of prior payments. A claims manager explained to Mr. Wiegel that Allstate would make no further payment under the appraisal award because it had already hired a forensic engineer who had determined that no functional damage to the roof was present or attributable to the May 24, 2023 storm.
The lawsuit asserts breach of contract, violations of New Mexico's Unfair Insurance Practices Act and Unfair Practices Act, and bad faith. The Wiegels seek compensatory damages, treble damages, punitive damages, attorneys' fees, and interest.
In a January 9, 2025 response to a compliance officer at New Mexico's Office of Superintendent of Insurance, Allstate defended its position, stating the engineer's report reflects that "No hail above the threshold of one and a half inches in diameter was reported from this location from 2020 through the time of the engineer's inspection." According to the lawsuit, the National Weather Service's Storm Prediction Center showed 2-inch hailstones at the property on May 24, 2023.
The case is pending in the United States District Court for the District of New Mexico. No ruling has been issued.
