Every year millions of homeowner’s insurance claims are filed as a result of fire, wind, floods, hail and other causes. When not informed, many people make serious errors in working with insurance companies.
The first step is: Don’t file an insurance claim until you verify damage is likely covered. Frequently a claim may be opened but the damage is below or slightly over the deductible and the homeowner would receive little or no funds. What many insurance companies will do is potentially raise your rates simply for filing a claim, even if there’s no payout.
Further, a homeowner needs to verify damage is a covered event. For example, during a very heavy rainwater may come down your driveway or hill entering your house causing significant damage. Unfortunately, if the homeowner does not have flood insurance generally the damage is not covered. Work with your insurance agent, and if necessary the adjuster, before a claim is filed to verify the damage will exceed the deductible and be covered.
Your insurance adjuster or agent may recommend a damage mitigation company. But keep in mind you are the customer, and you have the right to select a firm with whom you have confidence. The damage mitigation firm will usually ask for the deductible in advance of starting work which is customary. However, as a homeowner you should confirm the restoration company will interface with the insurance adjusters and arrange payment for the work directly. You should confirm with your work order that payments will be received directly from the insurance adjuster, which will be considered payment in full. A few mitigation companies will try to shake down a homeowner saying the insurance company only paid me $23,000 for $28,000 of work so pay me the other $5000. Even when stressed, read and understand your paperwork and commitments. When in doubt wait and don’t sign.
After a flood or fire there is a tendency to want to immediately start throwing things into a dumpster, but this is a significant mistake. Insurance adjusters will pay for damaged contents, based on your policy, but will not pay for items that have already been tossed. If for some reason you are required to get rid of some items fully document with photos the items thrown out. A homeowner can literally lose thousands of dollars by not documenting for insurance companies ruined or damaged items.
Work through the details of your insurance policy and understand what items are covered and not covered. For example, many policies cover living in a hotel when necessary.
A good step to take in advance is to document all of your home furnishings because none of our memories will pick everything up. Use your cell phone video to photograph everything in your home. Open your cabinets to document the number of linens and clothing in the home. Also check out your storage areas and likewise do a video inventory. If you have more valuable items, document if possible, the purchase price or provide your best estimate for your records. Make sure to upload your video to the cloud and email to a family member to keep in reserve.
When reconstruction is necessary the homeowner is usually entitled to have the work done in a like and consistent manner the home was in before the damage. Work with the contractor and the adjuster to make sure you are receiving similar quality finishes.
When major damage hits a house there’s no easy way to work through the challenges. But by following these guidelines you will avoid major mistakes and be in a position for the best possible repair.
Ezekiel wrote about a time when, “whitewashing any flimsy wall that is built” (Ezekiel 13:10-11) Would fail.” Make certain you hold your contractors accountable.
Prepare yourself in advance for disasters large and small, including a home disaster, by checking out the Ready Christian training.
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