A violent lightning bolt destroys your home. A barbecue accident leaves your guest injured. A burglar breaks in and harms your family. When an unfortunate event strikes close to home, you might need to file a claim with your insurance company. As part of the contract between you and your insurer, a claim against your homeowners policy comes with rules and procedures that both your insurer and you must follow. It’s important to know the steps to be prepared before you file a homeowners insurance claim.
Is Your Home Fully Protected?
Step 1: Take Inventory.
Record what you have in your home so you won't have to rely on memory in case of burglary, fire or some other unexpected case. It’s even better to walk through the house with a camera or a video camera to document footage and proof, carefully scanning each section of the house: rooms and attics included; inside and outside the house. We know it may seem trivial, even unnecessary, but taking out any valuable items separately and recording them can make the difference in winning your case. Keep the photos, video and inventory in a safe place outside of your house in case of emergencies. A great resource is the Insurance Information Institute's www.knowyourstuff.org to get started with your inventory.
Step 2: Making A Claim.
Have the insurance adjuster inspect the damage. Your insurance company will probably arrange for an adjuster to come and inspect your home. Be prepared to show the adjuster any structural damage and have a list of damaged items ready so you can make the best use of the time. An adjuster is a company representative who inspects property damage to determine how much the insurance company should pay for the loss. He or she will interview you and inspect the property.
If damage from a fire, windstorm or other natural disaster is extensive, you may want to have a public adjuster represent you in filing your claim. Public insurance adjusters are listed in the telephone book. They usually charge a fee of up to 15% of the total value of your settlement.
If you're considering using a public adjuster, ask your agent, a lawyer or friends or associates for recommendations and check his or her qualifications with your state insurance department. Don't use individuals who go door-to-door after a major disaster unless you can check qualifications.
Step 3: Promptly Fill Out Claim Forms.
If you establish that you'll be making a claim your insurance company will send you the necessary claim forms—by law, these must be sent to you within a specified time period. Return the properly filled out forms as soon as possible in order to avoid delays.
If you didn't do step 1: Photograph or videotape the damage, then take reasonable steps to protect your property from further damage. Prepare a list of lost or damaged articles. You're going to need to substantiate your loss, so make a list of destroyed or damaged items, then make a copy of the list for your adjuster. Also supply him or her with available copies of receipts from damaged items. Having a home inventory will speed this part of the claims process). If possible, avoid throwing out damaged items until the adjuster has visited your home. Save receipts for what you spend—you may be able to submit them to your insurance company for reimbursement later.
Step 4: Don't Make Any Permanent Repairs Before The Insurance Adjuster Arrives.
The company can legally refuse to reimburse you for repairs made prior to inspection.
You don't necessarily have to defer to the insurance company if your claim is refused; policies often allow for varying interpretations. One insurance company adjuster might consider your request for expenses to have someone thaw out frozen pipes an uninsured maintenance cost; another would consider it an insurable peril. Ask for a second opinion, and be persistent.
Don't sign a final settlement agreement if you're dissatisfied with the terms. Accept partial payment to make necessary repairs, as long as the insurer formally acknowledges that it is only a partial payment. If you can't negotiate a settlement, file a written complaint with the company. If that yields no results, you could either enter into arbitration with the company or contact your state's insurance department, which often acts as a referee in such disputes.
You can locate your state's insurance regulator by going to the National Association of Insurance Commissioners (NAIC) Web site, where you will find a map of the country with links to each state's insurance department. Only after you've exhausted those avenues should you consider filing a suit against the company.
When NOT to file a homeowners insurance claim
Not every incident requires filing a home insurance claim. If the cost of repairs is less than your deductible, then it's better to pay out-of-pocket.
Why? Because insurance companies all have access to a database called CLUE (Comprehensive Loss Underwriting Exchange) that contains information about your claim history. A history of multiple claims over a short period, however minor, can affect your premiums or your ability to obtain new homeowners insurance if you face cancellation or need to shop around for a lower rate.
"In smaller losses, if it's close to the deductible or slightly over it, we advise people not to file a claim at all," Swerling says. "If you have significant losses, you may have no choice but to file a claim. But with the smaller losses that are below the deductible, it's really not worth it."
If you need to relocate, keep your receipts. If your home is so damaged that you need to find other accommodations while repairs are being made, keep receipts and records of all additional expenses incurred. Most homeowners insurance policies provide coverage for additional living expenses in such cases, but you’ll need to provide proof of the costs.
If you have any questions about the claim filing laws in your state, call your insurance professional or your state department of insurance.
Once you and your insurance company agree on the terms of your settlement, state laws require that you be sent payment promptly.
As a property insurance claims professional since 1980, Mr. Altieri leads the firm at Altieri Insurance Consultants in all matters of property claim adjusting and community outreach. His decades of property claim adjusting experience assure the firm’s clients they are well represented, whether they have suffered a multi-million-dollar commercial loss or have lost their home. View Bio