It’s a comfort to have property insurance. It’s the prudent thing to do, and if you have a mortgage, condo, or business lease, it’s usually required. The problem is that the comfort of insurance can quickly disappear when you have a loss and begin trying to figure out how to get compensation for the actual cost of repair (being “made whole”), or even any compensation at all.
How hard can it be? Very. We trudge through pages of stiff, jargon-filled text for every claim that we file for our clients and catch every detail thanks to our extensive experience. We know that one mistake can seriously affect the amount and timing of a claim settlement. See for yourself. Below is a section from a typical homeowners’ policy describing your duties after a loss:
Duties of the Insured After Loss
In case of a loss to covered property, we have no duty to provide coverage under this policy if the failure to comply with the following duties is prejudicial to us. These duties must be performed either by you, an “insured” seeking coverage, or a representative of either. Give prompt notice to us or our agent;
- Notify the police in case of loss by theft;
- Notify the credit card or electronic fund transfer card or access device company in case of loss as provided for in E.6. Credit Card, Electronic Fund Transfer Card Or Access Device, Forgery And Counterfeit Money under Section I–Property Coverages;
- Protect the property from further damage. If repairs to the property are required, you must:
- Make reasonable and necessary repairs to protect the property; and
- Keep an accurate record of repair expenses;
- Cooperate with us in the investigation of a claim;
- Prepare an inventory of damaged personal property showing the quantity, description, actual cash value and amount of loss. Attach all bills, receipts and related documents that justify the figures in the inventory;
- As often as were as we reasonably require:
- Show the damaged property;
- Provide us with records and documents we request and permit us to make copies; and
- Submit to examination under oath, while not in the presence of another “insured”, and sign the same;
- Send to us, within 60 days after our request, your signed, sworn proof of loss which sets forth, to the best of your knowledge and belief:
- The time and cause of loss;
- The interests of all “insureds” and all others in the property involved and all liens on the property;
- Other insurance which may cover the loss;
- Changes in title or occupancy of the property during the term of the policy;
- Specifications of damaged buildings and detailed repair estimates;
- The inventory of damaged personal property described in 6. above;
- Receipts for additional living expenses incurred and records that support the fair rental value loss; and
- Evidence or affidavit that supports a claim under E.6. Credit Card, Electronic Fund Transfer Card Or Access Device, forgery And Counterfeit Money under Section I–Property Coverages, stating the amount and cause of loss.
This list leaves out some important factors which often lead to the biggest mistakes people make.
Because the average property owner isn’t fully versed in ‘insurance speak’ they often say the wrong thing when reporting a claim or talking to an insurance company adjuster. The following examples are worth noting:
- Do: It is a broken pipe (covered).
- Don’t: Describe the basement as ‘flooded.’ It is not a flood (not covered by your homeowners policy). A true flood requires a flood policy.
- Do: Mold is an indication that water was there. By making that distinction, there is coverage to the policy limit.
- Don’t: Say lots of mold. Mold is generally limited to $10,000.
- Do: It could be a plumbing problem. Again, by making that distinction, there is coverage to the Policy limit.
- Don’t say it is a sewage backup (limited coverage).
Another common mistake:
Don’t throw out your contents until the insurance company adjuster agrees to pay a fair price for them. Even if something is wet and clammy, put it aside and save it. Photos are good, but not conclusive.
There are many, many more such examples. As you can see, it’s pretty complicated. Let us handle it all for you. You’ll get the best settlement as quickly as possible, without having to try to figure out every word in your policy and paying the price if you make a mistake.