Keeping your policy up-to-date

August 21st | No Comments | Posted in Articles, General insurance

Once you purchase a homeowners policy, keep it up-to-date as your home and lifestyle change. For example, tell your insurance agent if you build an addition on the house or remodel the kitchen. It might be worth increasing your coverage to protect the enhanced value of your property. The same holds true if you add several valuable possessions, such as artwork, computers, or electronic gear. Reassess your policy to determine whether you have enough insurance to cover the new valuables or whether you need to add any riders.

If your property sustains damage or if you suffer a property loss, report it to your insurance agent immediately. Take pictures of any damage as soon as possible in case the insurance adjuster cannot examine the scene right away. Also report thefts or burglaries to the police at once because your insurance agent will request the police report.
When you call your agent to report damage or loss, ask the following questions:

  • Does my policy cover this damage or loss?
  • Does my claim exceed my deductible?
  • How long should I expect the processing of my claim to take?
  • What is the procedure for getting estimates to repair or replace the items that were damaged or lost?

For safety’s sake, follow up your phone conversation with a letter detailing the damage or loss. With the letter, include any evidence of the claim, such as photographs.
Your agent should immediately send you a claims form, in which you provide as much detail as possible about the property damaged or lost.
If your home has been damaged, you can make temporary repairs to prevent further damage. Your insurer should reimburse you for those repairs if you send the company receipts substantiating your costs. Also, save receipts for additional living expenses—for example, hotel bills—that you may incur while repairs are made to your home.
After receiving all necessary information, your insurance agent and adjuster will either accept or reject your claim. If they accept your claim, your agent will offer you a settlement that he or she thinks fair. If you disagree, ask your agent for an explanation. You do not have to accept an agent’s first offer. Often, he or she will negotiate the settlement with you until you are satisfied. If your agent still does not offer what you think you deserve after such negotiations or if your claim was rejected, you can take the following steps of appeal:

Send a copy of your original letter as well as a new letter explaining your dispute to the chief claims officer at the executive offices of your insurance company. All reputable companies have internal investigation departments to help resolve disputes.

  • Call the National Insurance Consumer Helpline (800-942-4242; www.iii.org). This industry-sponsored service might be able to intercede with your insurance carrier if its experts agree that you have not been offered a fair settlement.
  • Complain to your state insurance department. All insurance companies are regulated, and the insurance department should be able to help you obtain justice if it agrees with your complaint.
  • Have an independent arbitrator decide whether the settlement offer is fair.
  • Your insurance company may be able to recommend such an arbitrator through Arbitration Forums, Inc.
  • As a last resort, hire a lawyer, and sue the insurance company to collect a fair settlement. This process could cost hundreds or thousands of dollars and take many months or even years of litigation. Therefore, your claim must be substantial enough to make all this trouble worthwhile. Your lawyer should also give you an honest opinion about your odds of winning the case.
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