When a fire affects your home, you will have lasting damage even if the flames…
If your home was damaged by a recent storm, house fire, or a break-in, and you cannot afford to pay for disaster restoration out of pocket, you may wonder if it’s worth filing a home insurance claim in these situations.
Filing a claim with your homeowner’s insurance can be a stressful and perplexing process, especially if this is the first time you’ve had to do so. However, understanding when to file a claim, how the process works, and what to expect from your insurance company can make the experience less stressful.
Continue reading below to learn about when you should file a homeowner’s insurance claim, the steps required to file a claim, and what else you can expect throughout the process.
If your Kansas City or Wichita home has recently been damaged and you need the help of disaster restoration services you can trust, contact NCRI. Make us your first call and discover how our team of specialists can help lessen the impact of your loss.
When Should You File a Homeowner’s Insurance Claim?
You buy homeowners insurance to protect yourself from paying out of pocket to repair your home after disasters occur. However, deciding whether it’s financially prudent to file a claim can be challenging, especially when the cost out of pocket is minimal.
It is a fine line to walk, so it’s crucial that you carefully consider your options. Here are the most critical times that you should file a homeowner’s insurance claim:
Significant Damage or a Total Loss
As a general rule, homeowners should file an insurance claim if the damage to their home is significant and will be expensive to repair. This could include damage caused by a natural disaster, such as a tornado, or by a man-made event, such as a fire or break-in. However, if the damage to your home is minor, such as a small leak or a broken window, paying for the repairs out of pocket may be more cost-effective than filing a claim.
Repair or Replacement Costs Exceed Your Deductible
If the cost of repairing your home or replacing damaged household items is only slightly more than your policy deductible, you may want to consider paying these costs out-of-pocket. Every time a claim is filed, the Comprehensive Loss Underwriting Exchange is notified (CLUE). All carriers review this database, and a claim may increase your premiums at your next policy renewal.
Repeat claims, even those with low insurance payouts, may cause your property insurer to refuse to renew your policy. If this occurs, you may only be eligible for high-risk homeowners insurance, which is more expensive.
The Damage Is Covered by Your Policy
Homeowner’s insurance is not designed to cover routine maintenance or minor repairs. Your homeowner’s insurance is designed to cover significant and unexpected losses, which can be catastrophic. For example, a fire in your home is a typical example and will typically be the impetus for filing a claim.
However, your homeowner’s insurance company is not required to compensate you for every type of damage or loss to your home. In fact, while your policy may cover a wide range of events, it is likely to exclude certain events, known as exclusions.
You Have an Endorsement for the Damage
An endorsement is a supplemental coverage that provides coverage for things that a standard home insurance policy does not typically cover. Endorsements can even increase coverage limits beyond what a standard policy provides.
Endorsements increase your premium, albeit slightly, and may even include a separate deductible. However, when an endorsement covers the damage, it may make sense to file a claim because these are typically expensive repairs.
No Recent Claims
Insurers take into account your claims history when determining how much to charge for your premium or whether to cover you at all. If you’ve previously filed a claim, you’re more likely to file more claims in the future. Even if you pay your premium on time, insurance companies don’t want to be responsible for that risk.
Having more than two claims in the last five years can make it difficult to insure your home. If you have filed few or no claims, it may be worthwhile to file one if the amount is significant enough to warrant the potential notification on your CLUE report.
How Does a Homeowner’s Insurance Claim Work?
Owning a home can entail dealing with the unexpected, which can range from a tree falling on your home to a pipe bursting in your bathroom. Because you probably can’t prevent all unexpected surprises, knowing what to expect if you need to file a homeowner’s insurance claim can help give you some peace of mind.
Filing a homeowner’s insurance claim can be a time-consuming and confusing process if it’s something a homeowner has never experienced before. While insurance companies handle claims in a variety of ways, the following are some fundamental steps in the claim process:
Inspect the Damage
Before contacting your insurance company after a disaster, the first step is to survey the damage. Keep anything that has been ruined or damaged instead of throwing it away, so you have documentation for when the insurance inspector comes to assess everything.
Contact Your Insurance Company
After inspecting the damage to your home, the next step is to notify your insurance company. However, if the claim is related to a crime such as theft or vandalism, you must first contact the police.
During this stage, your home insurance provider will go over whether or not the claim is covered by your insurance policy and how long you have to file the insurance claim. They will also send you forms to fill out that fully detail the damage and give you an estimate on how long it will take to process the claim and whether or not the claim will exceed your deductible. Be sure to return any documentation as promptly as possible to keep the claims process moving.
Schedule Inspection with Claims Adjuster
Following the conversation with your insurance company, the next step is to have a claims adjuster assess the damage, interview you about the extent of the damage, and offer a monetary settlement to cover the cost of repairs. Upon their arrival, be sure to have any receipts or other pertinent information related to the insurance claim.
Get Repair Estimates
When the claims adjuster has finished their assessment, they will provide you with a report that details the damages and the estimated cost to repair them. If you agree to the report, your insurance company will pay for the repairs up to the amount of your deductible. If you disagree with the report, you may be able to appeal or seek mediation.
Depending on the extent of the damage, you should seek damage estimates from local contractors. However, check to see if your insurance company has its own guaranteed repair network, as this is typically a list of pre-qualified experts to whom you have access who can repair your home. Your insurance company may also offer a warranty on materials and labor if you use someone from their network, which can help you save money in the long run.
Receive the Claim Payout
Depending on the amount of damage and how persistent you are in following up with the insurance company, settling home insurance claims can take anywhere from a few weeks to a few years. However, after your homeowner’s insurance claim is settled, be sure to review any shortcomings in your insurance coverage and make changes to ensure you’re adequately protected going forward.
Depending on your insurance company and claims history, filing a claim could affect your premiums. If your insurer raises your rates, ask your insurance company about ways you can save money with your policy, such as bundling insurance policies or raising your deductible.
You will receive the insurance payout once your claim has been approved and you have agreed to the settlement amount. You will typically receive multiple checks based on the damage. If applicable, you will also receive an additional check to cover living expenses.
Call National Catastrophe Restoration, Inc. for Disaster Restoration Services You Can Trust
A homeowner’s insurance claim is absolutely necessary if your home is significantly damaged in a disaster covered by your insurance policy. However, the importance of carefully considering when to file a claim and when not to, and how doing so may affect your premium and pocketbook in the long run cannot be overstated. Taking the necessary time to assess the situation before filing a claim could save you tens or hundreds of thousands of dollars in out-of-pocket expenses, keeping you on track to reach your long-term financial goals.
For more than 50 years, National Catastrophe Restoration, Inc. has been the most trusted choice for disaster restoration services in Kansas City and Wichita. With our team of highly trained and certified restoration technicians, we remain dedicated to providing a wide range of professional disaster restoration services that prioritize your family’s safety while protecting your home and your most prized possessions.
If your home has suffered significant damage, contact the disaster restoration experts at National Catastrophe Restoration, Inc. today to learn more about how our restoration services can get you and your family back on your feet.