First Steps to Take After Suffering Property DamageTo get the most from your property damage claim, you should take the following steps right away:
- Report crime to the police. If burglars or vandals stole or damaged your home, contact the police immediately. Write down the names and badge numbers of the officers at the scene and request a copy of the police report to send to your insurer. If weather caused your property damage, skip this step.
- Notify your insurer. Call your insurance agent and let them know what happened. Be sure to ask if your policy covers the event, how much time you have to file your claim, if the damage will exceed your deductible, and if you need to get an estimate for structural damage repairs.
- Complete and file your claim forms. If you decide to file a claim, your insurance company will send you the required forms to complete. The law requires them to do this within a specified time after the incident. Promptly complete them and turn them in to avoid delays with your claim.
- Show the damage to the adjuster. Your insurer will send an adjuster out to inspect your home. Prepare a list of damaged items to show during the visit and include receipts if possible. Make sure to point out any structural damage to the home.
- Protect your home from future damage and make temporary repairs. Take pictures or video of the damage and then make temporary repairs to prevent further damage to your home. You should save the repair receipts since your insurer could reimburse you later.
- If you cannot stay in your home, save relocation receipts. If your home is uninhabitable, you might need to stay in a hotel for a while. While your homeowners' insurance might cover the costs, you'll need to keep receipts to prove your stay length and expenses.
- Hire a residential property insurance lawyer. You have every right to expect your insurer to honor the terms of your policy, but sometimes, it takes the help of an experienced professional to keep them honest. Hiring a lawyer could save you time, hassle, and money in the long run. Be sure to discuss your situation with your lawyer and rest easier knowing someone is advocating for your rights and interests.
Events That May Lead You to File a Residential Property ClaimMost of us understand that buying insurance is a way of managing risk. We purchase insurance policies and pay a monthly premium to shift the risk from a potential loss from ourselves to the insurance company. With it comes the expectation that the insurer will pay us when a destructive event occurs, including:
- Wind damage
- Water damage
- Hail damage
- Fire damage
- Freeze-related damage
- Lightning damage
- Tornado damage
- Theft or intentional property destruction by a third party
What Events Might Not Entitle You to Coverage Through a Residential Property Claim?Your homeowner's insurance policy will specify which events it will or will not cover. Most homeowners' insurance policies will decline coverage for massive events that are too large in scope to cover. These often include:
- Acts of war
- Government acts like seizure or eminent domain
- Nuclear disasters
- Other natural disasters
- Mold or other standing water damage
- Pest infestations like termites or bedbugs
- Sewer and plumbing backups (unless you purchased additional coverage)
- Everyday wear and tear
What Is the Goal of a Residential Property Claim?The goal of filing an insurance claim is to get the money you need to repair and replace damaged or destroyed property. The compensation your insurer owes you will depend on:
- The specific event that damaged your property
- The extent of the damage and destruction
- The language in your insurance policy
- Your deductible and the coverage limits on your insurance policy
- Any other conditions that could affect the outcome of your claim
What Damage Might a Successful Residential Property Claim Cover?In the event of sudden and unavoidable property damage, a homeowner's insurance policy generally covers:
- Structural damage. Any damage to structural components of your property—walls, the roof, ceilings, floor, foundation, or others.
- Damaged personal items. A homeowner's policy may generally cover any personal items damaged by water, fire, wind, or other events. This may include appliances, electronics, furniture, clothing, and other items.
- Damage to detached structures on your property. If your property has a detached structure such as a shed, gazebo, or workshop, your homeowner's insurance policy might include it.
- Cleanup and living expenses. Your insurance policy may cover the cost of cleaning up your damaged property. If you must relocate temporarily or permanently because of property damage, your insurance policy may cover some or all of your living expenses.
Why Might an Insurance Company Deny a Residential Property Claim?As a policyholder, you expect your insurance company to treat you like a valued customer since you could always take your business elsewhere. As a for-profit business, the insurance company incentivizes its employees to save money, which often means denying claims, even if they are legitimate. Some of the most common reasons for residential property claim denials include:
- Stating that concurrent events caused the damage. For example, your insurer may claim that you suffered leak-related water damage because you failed to maintain your roof—even if a hurricane exacerbated water flow into your property. The insurer may underpay or even deny your water damage claim because it claims your failure to maintain the roof is the proximate—i.e., most immediate—cause of the water damage.
- Claiming that your policy was not in effect at the time of the damage. The insurance company could argue that your insurance had not yet taken effect when the damage occurred. Similarly, your insurer could claim that you did not pay your premium on time, or that your insurance lapsed, disqualifying you from coverage.
- Arguing that the source of the damage predates your policy's effective date. If the insurance company claims that a leak started two years before your claim, and your policy only became effective one year ago, then the insurer may refuse to cover the damage.
- Categorizing the source of the damage as an uncovered event. The insurance company might claim that the event that caused the damage is not covered by your policy. This can occur if the insurer categorizes storm-related water damage as flooding, for example.
- Citing technical issues with your claim. If the insurer says you have made clerical errors, did not file your claim on time, or cites another technical issue with the claim itself, it could use them as grounds to deny your claim.
- Blaming you for the damage. Your insurer might argue that your own actions led to the property damage and disqualify you from insurance coverage.
Should You Hire an Attorney for a Residential Property Claim?It is always a good idea to hire a knowledgeable insurance attorney to help with your residential property claim. Residential property damage can be expensive, and you'll want to handle your claim correctly from the start. Hiring a lawyer can give you peace of mind that the paperwork is complete, thorough, and accurate, and that it's filed promptly so there will be no unnecessary delays. Your lawyer can deal with the adjusters and make sure they have a complete list of damaged or destroyed property. Because the insurance companies have significant financial resources and might stand firm in denying or underpaying your claim, you'll want to have an aggressive legal advocate with extensive resources of their own on your side. Without help, you risk getting a lowball settlement offer, or nothing at all. Lastly, your life may be more chaotic than usual in the aftermath of a devastating event. In addition to life's never-ending responsibilities, you now have residential damage and repairs to worry about. You may be relocating your family, repairing your property, continuing to work, and managing countless other obligations. Your lawyer could take the burden of the insurance claim and negotiations off of you, so you can focus on rebuilding your life.
Challenges You Might Face During the Claims ProcessDepending on the specifics of your situation, the insurance claims process could be quick and smooth or could be long and drawn out. The process can present challenges if you:
- Fail to notify your insurer and file a claim promptly
- Fail to complete the necessary paperwork thoroughly and accurately
- Do not have a comprehensive list of items damaged or stolen ready for your insurer
- If you fail to make necessary repairs and your property is further damaged
- Denying your claim
- Attempting to exclude covered losses from your settlement
- Undervaluing your losses
- Extending a lowball settlement offer
- Delaying your claim
- Overwhelming you with dense, confusing paperwork
- Intimidating you with legal threats