By: Lance T. Denha, Esq.
In the wake of recent natural disasters in both Texas and Florida, now is a great time to review and better understand the essentials of property insurance and the filing of claims. How the casualty and mechanism of loss is characterized has critical implications for insurance recovery. Policies commonly provide different amounts of available limits (and sublimits) for different types of losses. To complicate matters further, policies often contain overlapping ill-defined concepts of what is a “flood” vs. a “named storm,” including, for example, whether storm surge resulting from a named storm is treated as part of the named storm or as a flood.
To determine whether you have insured value coverage, read your policy. It’s important to understand most policies are written to require an insurer to pay the lesser of:
- the repair cost required to restore damaged property to the condition it was in before the accident; or
- the market value of the property before it was damaged.
Below are some helpful hints to utilize when recording the damage:
- Document your losses with pictures and videos, if possible, and include a list of damages to personal items;
- Keep detailed records of anything you spend as a result of the natural disaster (i.e. to make immediate repairs to secure your home);
- Check with the insurance company before discarding any damaged items as you will typically need show these items to the insurance adjuster;
- Retain a claim diary to notate each and every person who has corresponded with you regarding your claim and note the date, time and the issues discussed.
Your insurer may require you to supply a written “proof of loss,” although many insurers only do so if the loss involves multiple items of property or if the value of the claim is in serious dispute. A “proof of loss” is a sworn statement that states the date, time, and cause of the loss. It itemizes your lost or damaged property and states the repair cost or market value that you are seeking. You may need to attach repair estimates or appraisals to the proof of loss. Ask your adjuster to give you the “proof of loss” form that your insurance company uses.
If your insurer disputes the claim, your policy probably gives it the right to question you about the loss under oath. Before you submit to an “examination under oath,” you should get legal advice. You do not want to say the wrong thing and face the potential loss of your entire claim or a criminal charge for perjury or fraud. State law may place restrictions on the requirements that an insurance policy can impose. You should talk to a lawyer before taking legal action against your own insurance company to make sure you comply with necessary requirements.