Morris, King & Hodge, P.C., offers this fact sheet for persons affected by the storm who want basic information and advice for moving forward.
Table of Contents
Storm Damage and Insurance Claims
The first stage of the claim process – getting started:
I have a storm claim – what do I do?
The first step in the claims process is reporting your damage to your insurance company. Call your insurance company to report the claim. At this stage, your call will most likely be directed to someone gathering basic information such as contact information and broad general information regarding your loss. This person most likely will not be the adjuster assigned to assess and evaluate your claim and is not the person who will ultimately decide on insurance benefit payments to you. It is important to provide answers to any questions asked at this stage.
What if I cannot find my policy?
Immediately ask your insurance company or agent for a complete copy of your insurance policies, including your declarations page. That policy is the contract between your insurance company and you. You need a copy to understand what coverage types are available to you in case you later need to tell your lawyer this information. Some of these coverages may be difficult to understand. Basic coverage types in these policies include dwelling, other structures, personal property and loss of use. Common additional coverages include debris removal, property collapse, and reasonable repairs. Also, the policy will also determine amounts of coverage as well as any exclusions, conditions, and deductibles regarding coverage. The debris removal coverage, if available, may be particularly helpful at this early stage to pay to clear your property. While this fact sheet addresses residential homeowner’s insurance, commercial property insurance can cover both physical structures and property as well as loss of business and income as a result of a disaster.
I have been assigned an adjuster, so what happens now?
An adjuster’s job is to investigate the claim for the insurance company. Determining what caused the damage and placing a value on the damage are part of this stage. You should expect the adjuster to inspect the damage initially and provide guidance as to what you can do to move the claim forward. You should ask the adjuster what you should do to assist in the claims process. Take notes of any instruction given to you. If you do not understand anything, ask for clearer instruction or explanation.
The adjuster assigned to me does not work for my insurance company, should I be concerned
Oftentimes, following a natural disaster with widespread damage like we experienced on April 28th, insurance companies will employ what are called “independent” adjusters to help handle claims due to the high volume of claims coming in. This does not change any obligation of your insurance company. The policy between you and your company remains in effect and must be honored regardless of whether the adjuster is a direct employee of your insurance company or an “independent adjuster.”
I do not like my adjuster, what can I do?
You have an obligation under your insurance contract to cooperate with your insurance company. This might include answering questions you feel are unnecessary or impossible to answer at this time. Do not forget your obligation to cooperate. If you refuse to cooperate, you may be giving your insurance company an opportunity to not pay your claim, in whole or in part. That does not mean you have to accept any payment offer from the company. Instead, this means you have to provide information asked by the company or adjuster. If you find you cannot work well with your adjuster, you may request another one. Some policies provide for this right, while other policies do not. Prior to making this request, review your policy. Under the strain from and the recent destruction, such a request may also slow down your claim.
I cannot live in my home, what can I expect from my insurance company?
Determine what “Additional Living Expense” coverage you have from your adjuster and your policy. “Additional Living Expenses” generally includes hotel or restaurant bills; the limit in terms of specific dollar amounts or percentage of coverage are usually defined. Make sure you understand the limit – the maximum total amount of coverage – you have so you can budget your living arrangements. This coverage is designed to provide a comparable standard of living after a loss. Ask what documentation you need to provide to continue this coverage while you are displaced from your home.
Second Stage – Claim Valuation
What can I do protect myself at this stage?
Document your loss and timely file a proof of loss with the insurance company or its independent adjuster, as the case may be. Make your video and photographs of your damage as detailed as possible, as they are important if there is a later dispute with your insurance company over what was lost in the storm. Generally, in taking photographs and video, the more images of the damage, the easier it will be to prove your damages to the insurance company.
The adjuster is demanding a list of everything I lost. Do I have to do this?
Yes. You have an obligation to cooperate with your insurance company, which means providing requested information. Many people when faced with a complete loss assume the insurance company will pay the limit of coverage; unfortunately, this is not always the case. As difficult as it may be, start room by room and account for every item lost due to the storm.
I do not agree with the estimate to repair my home, what can I do?
If you do not agree with the insurance company’s estimate to repair your home, get your own estimate from a reputable contractor. Send that estimate to you insurance company, and ask that the adjuster meet with your contractor so the adjuster can understand the discrepancy. Put this request in writing.
What is the difference between “Actual Cash Value” and “Replacement Cost”?
Actual cash value is what your home and/or contents were worth at the time of loss. Replacement cost is the amount of money to replace your home or lost items. Some policies provide replacement cost coverage only when the item is actually replaced. It is important to review your policy and go over this coverage with your adjuster. You may be entitled to additional funds when you start replacing items if you have replacement cost coverage. Be aware that some policies require you to rebuild within a limited number of days in order to claim replacement cost for your lost dwelling. Also, it may be helpful to inform your insurance company that you intend to rebuild to obtain maximum coverage of benefits.
How to choose a contractor and report price gouging and fraud.
The following was issued by the Alabama Attorney General’s Office after the 2011 tornadoes:
“Attorney General Strange cautions consumers to be wary and to take the following precautions when hiring someone to make repairs:
- Find out as much as you can about the workers, especially if they make unsolicited contact with you or have come from out-of-town after a natural disaster.
- Ask for proof that they are bonded or insured.
- Ask if they are licensed. Regulations vary, but plumbers and electricians must be tested to be licensed by the state. Contractors may be required to have local licenses if they do major work, but those who do small odd jobs may not have to be licensed. You may check with the Alabama Home Builders Licensure Board to see if a contractor is licensed by calling 1-800-304-0853.
- Ask if this particular job requires a permit. Most construction and home repairs of major significance require a permit from the county or city. Do not let them talk you into applying for the permit in your name. If they do not want to be known to local officials, they may be hiding a bad reputation.
- Get a written estimate detailing the work to be done and setting a completion date.
- Ask for references. Get names and addresses, and consider checking examples of work they have done.
- Do not pay too much up-front. You should pay only a minimal amount, perhaps as much as one-fourth, to indicate good faith and ability to pay. If they tell you more money is needed in advance, be wary. They should be able to pay for supplies or have credit to make necessary purchases until you compensate them afterward.
- Make sure you can contact them. Be wary if they can only give you a pager number, a cell phone number, or a post office box address. Businesses with established addresses may be safer.
Attorney General Strange urges consumers and officials to report any problems of alleged fraud or illegal price gouging to his Office of Consumer Protection by calling toll-free 1-800-392-5658, by writing to 501 Washington Avenue, Alabama 36130, or though the Attorney General’s main web page at www.ago.alabama.gov.”
From offices in Huntsville, Alabama, Morris, King & Hodge, P.C., handles insurance disputes cases in counties and cities throughout the state of Alabama, including Huntsville, Athens, Albertville, Decatur, Florence, Fort Payne, Guntersville, Scottsboro, Cullman and Birmingham. If you think that we can help you or a loved one as we have helped so many other Alabamians with their Insurance Disputes cases, you may be entitled to benefits of which you may not even be aware. Please call our experienced attorneys in Huntsville (256) 536-0588, toll free 1-888-321-8353 or complete our quick contact web form. The Insurance Disputes lawyers at Morris, King & Hodge, P.C., can help you or a loved one.
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