Many homeowners have been shaken by the devastating winter storms that hit the country.
In Texas, Oklahoma, Louisiana and elsewhere, inclement weather left millions of people without power and inflicted billions of dollars in property damage. Ruptured pipes flood homes, and mold growth and other problems are likely to follow.
Home insurance can be essential to recovery, but it’s important to act quickly, keep good records, and pay close attention to your policy details. Here are four ways to get the most out of your home insurance coverage in a severe storm.
Review your home insurance policy
The first priority is to ensure your safety and that of your family. Once that’s under control, it’s time to check out what’s covered by your home insurance policy, says Insurance Information Institute spokesperson Mark Friedlander.
Visit your policy’s declarations page to see what types of damage are covered, your coverage limits and your insurance deductible. If in doubt, contact your insurer or agent to make sure you understand what your policy covers.
Key distinctions within a policy could translate into thousands of dollars. For example, some policies will cover the cost of replacing damaged goods, while others will only reimburse the actual value in cash. If a burst pipe ruins your five-year-old TV, replacement cost coverage will help pay for the cost of a similar new TV. Actual cash value, on the other hand, will be five years of amortization and only pay what the insurer thinks the TV was worth just before it was destroyed.
Report the claim to your insurer
If a storm damages your home and you need to make a claim, report it immediately to your agent or insurance company.
“There are going to be a lot of complaints, [so] it’s important to file your claim or notify your agent or company early on, ”says David Sampson, president and CEO of the American Property Casualty Insurance Association.
Technology will be your friend in explaining what happened, Friedlander says. “Take pictures of it if you can.” The video is good, but definitely at least photos with your phone so you can document the damage. “
Don’t throw away anything that might affect your claim unless specifically authorized to do so by your insurer, advises Liz Heigle, communications director for the Oklahoma Department of Insurance in an email. She also recommends keeping a list of everyone you talk to the insurance company about your claim.
Social distancing guidelines during the COVID-19 pandemic have made the initial stages of the claims process easier and faster. In many cases, insurers virtually handle the initial damage assessment, Friedlander says, reserving in-person expert visits for the most serious cases.
If an expert needs to inspect the damage in person, Heigle recommends being present to discuss the damage. If you can’t do that, leave a note indicating where the expert can contact you.
Fix what you can
Once you’ve spoken to your insurer, you can take care of any repairs that require special attention.
If, for example, a pipe is dripping water in your home, you don’t have to wait for a contractor to show up to fix the problem. As long as you have a clear understanding with your insurance company of what to do next, you can make emergency repairs without risking losing insurance coverage.
When doing repairs, be sure to document all of your expenses. Anything you buy to fix the problem will be covered as part of your claim.
If you have no water or electricity due to a winter storm, you may need to temporarily live elsewhere. Your insurance company will usually pay your additional living expenses while you are moved, but there may be coverage limits and other restrictions, so you should discuss this step with your insurer.
Beware of fraud
Insurance fraud is a common problem following severe storms. Unscrupulous entrepreneurs take advantage of people’s desperation by inflating costs or taking money up front and not completing a job, among other projects.
“The money will come either from the federal government or from insurance or a hybrid of the two, and fraudsters know it,” said David Glawe, president and CEO of the National Insurance Crime Bureau.
There are ways for consumers to avoid falling victim to these scams, says Camille Garcia, spokesperson for the Insurance Council of Texas, in an email.
She recommends checking references and reviews online before choosing a contractor, then paying in installments as the work is completed to your satisfaction.
“Don’t sign your insurance proceeds check to a contractor,” Garcia says.