Insurance is one of those things that most of us do not give much thought to. However, when we need it, we sure are glad that we chose to make the monthly investment into protecting ourselves from the costs of repairs or replacements on our most valuable assets.
With the right insurance provider, the process of filing a claim through your insurance company can be straight forward, but it is important to be prepared before you are in the midst of dealing with a household emergency.
The Basics of Making a Claim
When you are filing an insurance claim, the first thing that you should do is review your insurance documents to make sure you understand what is covered and what is not covered. Usually, you can start a claim by calling a phone number or logging into an online portal with your insurance company.
After the insurance company receives the claim, they will usually call you. During this initial phone call, you will likely be expected to give a brief description of why you are filing a claim. It is usually during this phone call that the insurance company will also schedule a visit to view the damage to your property in person.
During this visit, the insurance adjuster will likely take several photos to document the damage that they see during their visit. You will likely be asked questions again about the event that caused the damage a second time.
If you want, you can submit a written quote that details the items lost as well as providing the insurance company with a monetary value estimate for all of the property damaged or lost during the event. Some companies actually require this step, but it is highly recommended that you do this in order to boost your chances of getting the full value of your items.
It typically takes just a few weeks for your insurance adjuster to contact you with their decision on a settlement. Usually, this includes giving you money in order to replace, repair, or fix your belongings. The replacement cost is usually issued based on the research done by the adjuster, but they also take your own research into account.
The Settlement
You will receive a settlement only if the issue is found to be covered by your insurance. For instance, you may be able to claim on repairing the damage caused by a leaking pipe provided the issue was not caused by you. Similarly, it must have occurred suddenly; if not, this could be a sign of negligence on your part, and nullify your claim.
If you are still paying a mortgage on your home, then it is likely that any settlement check issued by the insurance company will actually be made out to you and the lender. This is done in order to protect the lender. Similar to a construction loan, the lender releases the funds to you in segments based on the progress of the repairs being done to your home.
How Does the Adjuster Determine Settlement Amount?
Typically, when you agree to your homeowner’s insurance policy, there is a contract involved. In that contract there are various terms and conditions that you agree to and this document dictates largely how your settlement amount will be determined.
For example, when you are signing yourself up for homeowner’s insurance, you can choose either replacement costs or actual cash value. If you choose the replacement costs route, then your insurance company will fund the entire cost to rebuild or repair your home using materials that are similar to the original build. Determining the actual cash value uses the age, condition and value of the home to issue money to you.
As you can imagine, these two different types of coverage can actually result in a very different settlement amount. The market value of your property is not always going to match the repair or replacement value of that home.
So, this is one of the many mysteries that you need to figure out before you even have the in-person meeting with an adjuster.
Final Thoughts
There are a great many reasons you might one day have to file a claim with your insurance provider. In 2019, for instance, more than 76,000 homeowners were forced to claim for lightning losses in the United States alone.
Although it might seem overwhelming at first, making a claim on your homeowner’s insurance policy is not quite as difficult as it might initially seem. The best advice that we can give is to take the process one step at a time. If you try to get too far ahead of the insurance claim process, then you might overlook something in the process of working with your adjuster. In the end, keep in mind that you and your insurance adjuster are partners and you should have open communication with each other throughout the process.
