Having to make a homeowners insurance claim is bad enough. It means that something has gone wrong, and you must fix it. You may have been affected by a fire, wind or rainstorm, water damage, or a natural disaster such as a wildfire or flooding.
The last thing you need is a problem with your claim, but as the cost of repairs and replacing belongings increases due to inflation and more frequent extreme weather, insurance companies are increasingly looking for ways to cut back on the amounts they pay to claimants.
These are some of the most common problems people face with insurance claims. If you can avoid them initially or resolve them once they crop up, your claim will likely go smoothly. For major claims, you can also hire a public adjuster or an insurance lawyer to help you easily navigate any potential complication.
#1 Communication Issues with the Insurer
There are two types of communication problems that often arise with insurance companies. The first is when the insurance adjuster takes too long to reply or does not get back to you. This can cause unnecessary delays that cost you more in the long run.
The second is when the responsibility falls on you to stay on top of your claim. You have an obligation to meet deadlines and keep the insurer informed. There are cases where the insurer puts undue pressure on the claimant to sign final documents. Still, an insurance lawyer or adjuster can help you navigate what is reasonable and adhere to deadlines.
#2 Depreciation of Personal Property
A major part of homeowners insurance claims is the Contents coverage of a policy, which covers the cost of lost personal belongings, such as furniture, electronics, clothing, and valuables.
One of the most common issues in claims is how the insurance adjuster depreciates that personal property. When you have Actual Cash Value coverage, the insurance company bases their valuation and payment on the value of the belonging if it had been sold the day before the loss. Rather than receiving the cost to replace the item, the homeowner is paid out based on the depreciated value.
The way depreciation is calculated can be a source of disagreement with the insurance company. Not all items depreciate in the same way, and the calculation may be based on the wrong information. Negotiating with the adjuster to apply reasonable depreciation rates can improve the settlement you receive.
#3 Cost of Repairs and Fixing Structural Damage
Damage from a fire or flood can be devastating, and homeowners rely on their insurance policy to help them rebuild their homes and lives.
However, problems can arise from the way an estimate is generated. The insurance adjuster will create a Scope of Work, either by themselves or by working with a contractor or engineer. Based on the Scope of Work, the insurance company usually has a number of preferred contractors bid on the job. They base their estimate on the lowest bid and payout based on that number.
Suppose there are essential repairs that have been left out of the Scope of Work, or you feel costs are likely to go beyond what the insurance company offers. In that case, it can help to have an insurance lawyer who can work with you to address these issues with the insurance company and negotiate for a scope of work that encompasses all necessary repairs.
