What happens when you file a homeowner’s claim?

A lot of people wonder this and are really hesitant about filing a claim because of the uncertainty or may be over zealous about filing for things that are minor without understanding the consequences and how your claim history may affect your renewal eligibility and rates.

Let’s take water damage as an example. Many times water damage can be mitigated and dried without extensive work, demolition and cost but most property owners don’t have the tools they need to thoroughly investigate the affected area and will often leave some areas wet that can lead to mold growth. I would suggest always calling in a professional to evaluate things even if you believe it’s been dried. We have specialty tools and equipment that can identify moisture trapped below flooring, inside wall cavities and the experience to know where to look for issues. Most of the time there won’t be a charge to have someone come and verify things are good.

Even if the project looks really large it’s best to talk with a restoration contractor before filing a claim. Based on their experience and evaluation of the affected area they should be able to tell you if it’s likely to exceed your deductible. On homeowner’s insurance the policy holder will always have a deductible that they are responsible for paying. It’s usually $500-$2500. If you have a large deductible policy, most water losses won’t be worth filing. We generally use a guideline of 2x the deductible to help people determine if they should file a claim. Either way, you need to get things dried out to prevent mold growth and prevent the water damage from spreading.

Many times, we see losses with clients that have a $1000 deductible and initially things look relatively straight forward but as the project progresses, we find additional trapped water or find additional areas that require demolition. When that happens, we work with our clients to determine if the new circumstances will warrant filing a claim. Sometimes it does and sometimes they prefer to wait until all mitigation is complete to file. Most policies allow 30 days or longer after the event to file a claim. Just be sure things are documented well with photos of the damage and the initial condition of the property.

Some people want to wait to have mitigation (drying) performed until the insurance company’s adjuster has come out to evaluate the loss. This is a mistake. The adjuster needs to see what had to be done as far as demolition so they know what needs to be put back together for repairs. It’s very common for us to meet with the adjuster at the property to show them all the damage and explain what needed to be done. We do this even if the customer has another contractor who will perform repairs because it’s absolutely critical that the insurance adjuster knows everything that was affected. They want to put things back the way they were before the loss but to do that, they need to know what all was affected.

On the other end of the spectrum, if you file a claim that isn’t covered or ends up being right at your deductible it will most likely still affect your rates. Most companies have a points system or various discounts that will keep your rates low. When you file a claim you accumulate points or lose discounts and your rates will likely increase. In some cases you may even be dropped so it’s best to have someone familiar with the insurance industry review the scope of the project before you file.

If you suffer a water loss at your home or business give us a call and we’ll help guide you through the process. We’ll be with you every step of the way and make sure you have the benefit of our experience as you navigate the claims process.