Homeowner Insurance Claims

Homeowner claims are paid in several different formats. If your property is damaged and needs repairs, often the Homeowners claims adjuster will make the payments directly to the contractor that is doing the work. This eliminates you from dealing with a contractor who may try to charge you more than the insurance carrier has agreed to pay. There is typically a deductible on the Homeowners policy for property losses, however, so you will need to pay the contractor that amount to pay for the repairs in full.

If there is an extensive amount of damages, often the claims adjuster will issue the checks payable to you and the mortgagee, particularly if you have not decided on a contractor to use to do the repairs. This will necessitate you in getting the mortgagee to sign off on the claims check before you are able to pay for the repairs. It is often easier to use a contractor that will accept the payment directly from the insurance carrier, to eliminate delays in getting the repairs done as quickly as possible.

The Claims adjuster will often assign an outside adjuster to come and assess the amount of the damages to compare the estimate with one that you may have received from a contractor. The outside adjuster may take photos of damages and do a thorough inspection to be sure that all of the damages have been seen and are taken into consideration. You will have to allow the outside claims adjuster access to the property to complete the evaluation, in order for the company to settle the claim. The insurance policy states in its conditions section that you need to allow the company to visit and access the damages.

You will also have to provide the claims adjuster proof of the amount of damages. That might be receipts for the property when purchased, appraisals, photos of the property before the loss occurred. In this day of technology, insureds are using videos and digital cameras of their homes and personal property and storing them in a safe place, away from the home in the event there is a loss so that they already have that proof to show to the claims adjuster.

Your Insurance Carrier will respond to your claim report as quickly as possible. They want to return you to as close as possible, to the same position as you were previously to the loss in a timely manner. You may have coverage for Loss of use which provides additional funds should you have to relocate while repairs are being made. The Insurance carrier will reimburse you for these expenses but it is important to know exactly what your limits are. That is why it is important to get the repairs done quickly so that you can get back into your home.

Depending on your actual policy terms, the claims may be paid on a replacement cost basis. That is what ever it will be to replace the property with like kind and quality to bring it back as close as possible as it was prior to the loss. Other claims are paid on an Actual Cash Value basis. These claims are the replacement cost basis, with depreciation deducted. This is often the method used for personal property claims.

If the damage was from a fire, you will need to let the insurance company know which fire department responded so that a copy of the fire report can be obtained. If the damaged was a theft, you will need to provide the police report number so that the insurance company can obtain a copy of that report.

If repairs are necessary by several different types of contractors, the insurance company will want to be sure that you get the work done to your satisfaction. They may have a listing of approved contractors for you to use in your area, and you may need to use those on their lists, but you certainly do not have to use a home improvement contractor for example to do everything. Often some repairs require licensed contractors, particularly in the electrical area.

Cleanup of Mold may or may not be a covered loss under your policy. If a leaking pipe is not repaired, the leak may eventfully cause mold damage. As a result the insurance may not cover this damage because it could have been prevented if you made the repairs on the pipe. A pipe needs to apparently leak for sometime for mold to begin to develop. Therefore, the policy conditions states it does not cover damages done as a result of your neglect or damages that are within your control. Had you had the pipe repaired as soon as it started to leak, the mold would not have developed

There is no deductible for Liability or Medical Payments coverage. The insurance company pays all of the damages, if you are found to be legally liable under the Liability. Under the Medical Payments, you do not have to be legally liable and the company pays all of the costs, up to your limit of coverage.

It is not the standard practice for the insurance companies to increase premiums as a result of Homeowners Claims. However, in the past few years, because of severe hurricanes, tornados, floods, and increased crime in residential areas, property premiums have been increasing to cover the additional expenses of the insurance companies. Also after Sept 11th, reinsurance costs went up substantially for all of the insurance companies. As a result property rates have gone up dramatically.

There may be specific questions you have regarding handling of claims, and we will be happy to answer those questions for you, if you contact us.