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Many homeowners have been left reeling as devastating winter storms lash the nation.
In Texas, Oklahoma, Louisiana and elsewhere, severe weather has left millions without power and inflicted billions of dollars’ worth of property damage. Burst pipes are flooding homes, and mold growth and other issues are likely to follow.
Homeowners insurance can be essential to recovery, but it’s important to act quickly, keep good records and pay close attention to the details of your policy. Here are four ways to get the most value from your home insurance coverage when dealing with a serious storm.
Review your homeowners insurance policy
The first priority is to ensure your and your family’s safety. Once that is under control, it’s time to check what is covered by your home insurance policy, says Insurance Information Institute spokesperson Mark Friedlander.
Look at your policy’s declarations page to see what types of damage are covered, your coverage limits and your insurance deductible. If anything is unclear, contact your insurer or agent to make sure you fully understand what your policy covers.
Key distinctions within a policy could translate to thousands of dollars. For example, some policies will cover the replacement cost of damaged belongings, while others reimburse only the actual cash value. If a burst pipe ruins your five-year-old TV, replacement cost coverage will help pay the cost of a new, similar TV. Actual cash value, on the other hand, will account for five years of depreciation and pay only what the insurer thinks the TV was worth right 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 to your agent or insurance company right away.
“There's going to be a massive number of claims, [so] it's important to file your claim or to notify your agent or company very 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. “Get pictures of it if you can. Video's good, but definitely at least pictures with your phone so you can document the damage.”
Don’t throw away anything that might affect your claim unless explicitly cleared to do so by your insurer, Liz Heigle, Oklahoma Insurance Department communications director, advises in an email. She also recommends keeping a list of everyone you speak with at the insurance company about your claim.
Social distancing guidelines during the COVID-19 pandemic have made the initial steps of the claims process easier and quicker. In many cases, insurers will handle the initial damage assessment virtually, Friedlander says, reserving in-person visits from an adjuster for the most severe cases.
If an adjuster needs to inspect the damage in person, Heigle recommends being present to discuss the damage. If you can’t make it, leave a note with information on where the adjuster can contact you.
Repair what you can
Once you’ve talked to your insurer, you can take care of any repairs that require attention.
If, for instance, a pipe is dripping water into your home, you don’t have to wait until a contractor shows up to address the problem. As long as you have a clear understanding with your insurance company about the steps to take, you can make emergency repairs without the risk of losing insurance coverage.
As you make repairs, be sure to document all your expenses. Anything you buy to fix the problem will be covered as part of your claim.
If you don’t have water or electricity due to a winter storm, you may need to temporarily live somewhere else. Your insurance company typically will pay your additional living expenses while you are displaced, but there can be coverage limits and other restrictions, so you should discuss this step with your insurer.
Beware of fraud
Insurance fraud is a common problem in the aftermath of serious storms. Unscrupulous contractors take advantage of people’s desperation by inflating costs or taking money in advance and not completing a job, among other schemes.
“Money will come in either from the federal government, or insurance, or a hybrid of both, and the fraudsters know it,” says 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 online reviews before choosing a contractor, and then paying in installments as the work is completed to your satisfaction.
“Don’t sign your insurance proceeds check over to a contractor,” Garcia says.