How to protect your property rights during the insurance adjustment process
Once you file a claim, your insurance company will send an adjuster to assess the damage. This adjuster is an employee of the carrier. Yes, their job is to assess the loss as accurately as possible, but they’re doing so within the context of protecting the insurance company’s financial interests. Viewing this as a friendly inspection is one of the costliest mistakes a policyholder can make.
The reality is that the adjustment process is akin to a legal proceeding. The paper trail you begin on day one will largely determine whether you’ll be paid what you’re owed or will spend the next year trying to prove your entitlement.
Start building your case before anyone arrives
As hard as it sounds, your next step is to read your entire policy. Most insurance documents include a “Declarations” page that outlines the coverages you’ve selected, perils you’re protected against, and any limits or deductibles. Section I of a typical homeowner’s policy, for instance, provides coverage against 16 perils, 12 more common (fire, wind, hail, etc) and four exotic (volcano, riot, aircraft, and explosion). If you bought separate flood or earthquake coverage, those would typically appear in Section II.
A “Conditions” section sets the rules and obligations for both you and the carrier; it’s under these provisions that many denials are grounded. That’s followed by a “Definitions” section, which sounds dull but can fundamentally alter the scope of your coverage. In the sample policy I downloaded, “collapse” is defined as covering building collapse only when it’s caused by a listed peril, none of which include termites, settling, or faulty workmanship.
Document every interaction
Documentation is key. Write down and take pictures of everything. Didn’t have time? The contractors probably did and promptly shared with the company. Every meeting, write it up. Someone comes out to inspect, were they taking photos or notes? You should be.
Someone leaves a card at your door, “appears” to inspect, write that down too. Have a real estate sign in your yard? Double the chances they scoped your job. Smiley faces and note-reads to the adjuster? Write them down. Written on their card or truck, independent something? Google them. Write what others said you said down. Fix-or-replace estimate from a contractor left out? Adjuster promised to do something but didn’t? Write it all down. The devil is in the details. Make them write it down too.
The specific challenge of catastrophic weather events
Claims resulting from a storm have their own set of problems. For the most part, the more extensive the damage, the more likely it is that adjusters will be brought in in droves. Their assessments may be rushed or incorrect. And if you’re hit by a catastrophe that’s also hit a “catastrophe area” where the damage is so extensive that carriers are allowed to put you through a quick, simplified, and low-ball settlement process, you are at an especially high risk of being asked to sign a broad or inappropriate release.
Supplemental claims are appropriate to file when you uncover additional damages after your claim has already settled. For homeowners filing hurricane damage claims, your insurance company may have missed paying an element of your damages in its initial payment. Either way, it’s likely that you’ll need to uncover the cause of the missed damage and document the extent and cause of both the old and new damage.
Common errors or omissions that might lead you to file a supplemental include your contractor’s finding additional damage, undiscovered water intrusion, or noticing that the new damage was caused by a peril that also caused the previously paid-for damage.
Know when professional representation changes the outcome
The difference between claimants who had representation in their property insurance claims and those who didn’t is staggering. When claimants handled the property insurance claim themselves, the carrier’s initial correct low-ball offer or near-complete denial often stood as the carrier’s last word. Policyholders who had hired representation from the outset, however, obtained settlements up to 747% higher (yes, seven-hundred forty-seven percent) than the amount initially offered by the insurance carrier (Florida OPPAGA). 647% higher on average.
The adjustment isn’t the end of the process
An adjuster’s estimate is not final. It’s what insurance companies call a “reserve” to pay your claim. You can and should push back, pull out all the documentation you’ve been doing and show him, or her, where the real figures lay.
You have the right to file a dispute, to invoke your policy’s appraisal clause, and go to court if the insurance company is making a bad faith effort to delay or deny your claim. There are statutes of limitations that can limit your time to act, but far too many policyholders lose their rights to recover what they’re owed because they were steamrolled by their insurance company’s eagerness to write a check before the full bill was in.
