FAQ about Insurances and Claims
Usually, a home insurance policy will cover three things.
- the building itself
- the personal contents in the home, such as furniture, clothing, food, and household items.
- the additional living expenses (ALE).
Renter’s Insurance works the same way, but probably won’t include structural coverage, and landlords probably won’t have full contents or living expense coverage.
Contact your adjuster or broker and request a copy of your declaration. A declaration is usually 2-4 pages long and lists the details of your insurance coverage. The fine print is in the long-form insurance policy. It is important that you have a copy of the long-form too.
Contact your insurance company in writing and inform them of your loss. Request an emergency cash advance to help with any financial burden. Make sure you keep all receipts of your spending as the insurance company may want to see them later. Any cash advance will be deducted from your final settlement.
A schedule of loss (“SOL”) is necessary for a claim under the “content” coverage of the policy. A SOL is a list of all of the contents damaged or destroyed. It includes descriptions, quantities, and values. You will negotiate the replacement value of your lost items from this list.
The adjuster works for the insurance company and their priority is to settle your claim quickly and to keep the cost of the claim as low as possible, which would benefit your Insurance company.
This varies by case, and the repairs or rebuild may last months if not years. Getting your ALE’s set up and getting the content negotiated can often be accomplished within the first 6-8 months.
Your normal bills will continue. You are still responsible for mortgage or rent payments, as well as continuing utilities. If you are told that you will be out of your home for a long period of time, you may want to inquire with some of your providers about transferring your account to the temporary residence or cancelling temporarily.
You should stay somewhere safe, but consult your policy since many suggest that the place you stay should be comparable to your home. In other words, you cannot benefit by moving into a more luxurious residence at the expense of your insurer, and the insurer cannot force you to stay in an unsuitable accommodation to save money.
Any costs that are necessary in order for you and your family to continue living your normal lives should be covered, but only in the amount they have increased from what your normal expenses would be. For example, the costs of staying in a hotel should be covered, but regular utility bills, will not be if they have not increased. A pass to the Zoo would not be covered because it is not necessary.
It is when you agree to accept a lump sum of cash for settlement of one or more parts of you claim. If you accept a global cash settlement on your ALEs, it is then your responsibility to budget to cover all the costs you will encounter while you are out of your home. If you go over budget and cannot cover continued accommodation or moving costs, the Insurer will not provide additional funds. The same can be said for the global cash settlements for structural repair or content replacement.