The Claims Settlement Process after a Disaster Strikes
The Claims Settlement Process After a Disaster Strikes
Art Glasgow, Peck-Glasgow Insurance
May, 23, 2010
The First Steps
Contact your agent or company immediately. Find out: whether the damage is covered under the terms of your policy; how long you have to file a claim; whether your claim exceeds your deductible; how long it will take to process the claim; and whether you’ll need estimate for repairs.
Make Temporary Repairs! Always take reasonable steps to protect your property from further damage. Save your receipts for what you spend and submit them to your company for reimbursement. Cover the damaged area with a tarp, or other means to keep weather out, and minimize your damage.
If you need to relocate, keep your receipts. If you need other accommodations while your home if being repaired, keep your receipts until the adjuster (the person professionally trained to assess the damage) can make longer term arrangements.
Prepare for the adjuster’s visit. Your insurance company may send you a proof of loss statement to comlete or an adjuster may visit your home first. All information that you have about the damaged property is a plus. If you have contents damaged, go ahead and start an inventory of the the items damaged. Don’t throw away any items until the adjuster views them and says it is ok to discard them. Before the storm is the best time to prepare a good inventory of your property. It is easier to do this before it is actually destroyed. Photo’s or a video tape are a big help in substantiating your loss.
Identify structural damage to your home and other structures such as a garage, tool shed or in-ground swimming pool. Make sure you get questionable items checked such as the electrical system, foundation, roof system, etc….
Get written bids from licensed contractors. The bids should include details of the materials used and prices on a line by line basis. A good reference for a contractor is your local builders assocation. They can provide you with a list of qualified, established contractors that will be there when you need them in the event a problem arises after repairs are completed.
Keep copies of the lists and other documents you submit to your insurance company. Also keep copies of whatever paperwork your insurance company gives you and record the names and phone numbers of everyone that you speak to.
Factors that Determine the Amount of Settlement You Get
Replacement Cost and Actual Cash Value. This depends on the policy terms of your individual policy. Replacement Cost policies provides you with the dollar amount needed to replace a damaged item with one of similar kind and quality without deducting for depreciation due to the age, wear and tear, and other factors. Actual Cash Value policies pay the amount needed to replace the item minus depreciation.
Policy Limits. Most insurance policies provide adequate coverage because they include an inflation guard clause to keep up with increases in local building costs. Most insurance professionals recommend that a dwelling be insured for 100 percent of replacement cost so that you have enough money to rebuild if your home is totally destroyed.
Temporary Living Expenses. If you can’t live in your home because of the damage, your insurance company will advance you money to pay for reasonable additional living expenses. Among the items typically covered are eating out, rent, telephone or utility installation costs in a temporary residence and extra transportation costs
Rebuilding and Making Repairs. If your home was destroyed, you have several options. You can rebuild a new home on the same site. Depending on state law, you can sell the land and build or buy a house in a different place, even another state. You can even decide that you would rather rent. If you decide not to rebuild, the settlement depends on state law and your insurance policy. In most cases you are paid actual cash value since the property in to actually replaced.
Good advice: Take the time to evaluate your homeowners insurance policy and review all coverages, limitations and exclusions with your agent. Make sure you are involved in the discussion of “what you are buying”. Understand it, and ask the about the company and their normal claims process. Make sure you are adequately insured. Consider taking a home inventory to make the claims process easier in the future. A neat site is www.knowyourstuff.org for downloadable home inventory software.
Call a Peck-Glasgow Insurance Agent in Hartselle, Madison, Decatur and Huntsville, Alabama to discuss your options and compare company quotes and coverages.