After the storm, expedite insurance claims
NEW YORK (11/13/12)--Property owners should roll up their sleeves, gather necessary documentation, and be prepared to duke it out with insurance companies in the wake of Hurricane Sandy, which could cost insurers $15 billion to $20 billion in claims.
Sandy's path of destruction stretched a thousand miles wide. Claims of more than $13 billion would make it the third most expensive hurricane on record, behind Katrina and Andrew (Bloomberg Businessweek Nov. 5).
Advocates from the Consumer Federation of America, Washington, urge homeowners to be vigilant when filing damage claims. These suggestions can speed up the claims process:
* Don't wait. Insurance companies handle claims on a first come, first served basis. Get your claim number and write it down; you'll need it each time you speak with a representative.
* Get details about the adjuster. Ask if the adjuster is an employee of the insurance company or an independent adjuster hired by the insurer. If the independent adjuster is not authorized to make claim decisions and payments on behalf of your insurer, get the name of the company adjuster who makes those decisions. You may need it later.
* Keep good records. Start a notebook to document contacts as well as dates and times of conversations. Take good notes about each exchange. If an adjuster misses an appointment, write that down. If someone is rude, write that down, too.
* List your possessions. If you didn't put a personal property inventory in a safe deposit box or other disaster-resistant safe at home, re-create a list of belongings. If you have no documentation, other family members may have photos from holiday or other celebrations you hosted.
* Keep receipts. Emergency repair and temporary housing costs may be reimbursable under the "additional living expense" portion of your homeowners policy. However, don't repair anything or dispose of ruined property until the adjuster has examined everything (ConsumerReports.org Oct. 30).
* Ask "why" if your claim is denied or if you believe it's too low. Demand that the insurer show you policy language that served as the basis for its decision--you'll need this information if you go to court. Once you know the reasons for denial, the insurer cannot produce new reasons for denial or for making a low offer at a later time; you've locked them in. To get a resolution, start by complaining to more senior staff. If you're not satisfied, complain to your state insurance department. Still not satisfied? Consider hiring a layer, who will need all the documentation you've kept from day one.
It won't always be obvious if Sandy's damage is flood- or wind-related, so fast-tracking your claim may be tricky and delays are inevitable (MarketWatch Oct. 31). Expect some insurers to try to limit their payouts, which is why it's important to be vigilant and keep good records.
Visit fema.gov/disaster/4086 for disaster assistance resources.
For related information, read "Avoid Buying a Flood-Damaged Used Car" in the Home & Family Finance Resource Center.