Here at R4 Restoration we understand that there are many things to consider before filing a claim and it shouldn’t be an automatic first response to do so.
What Should My First Step Be?
Be careful! If you are not sure whether an incident is worth filing a claim for DON’T call your insurance company’s claims phone line yet. ‘But wait.. couldn’t they help me decide whether or not to file a claim?’ In most cases, no. The operators or claims handlers on the other end of the phone are simply there to do data entry. This means that when you call and give them your name and policy number to inquire about a claim, it then goes on your record whether or not you actually file a claim. Some insurance companies will not insure someone who has had even two of these non-claims recorded. You (or your house) are considered a risk if you have constant problems with your home.
So, what should you do? First of all, use some common sense. If you have a reasonably small deductible, $1,000-2,500 or so, and you had a water heater rupture that caused your whole basement or multiple finished rooms to become saturated or flooded with water, then it is most likely going to be something you will file a claim on. Or, if you have a $5,000 or even a 1% deductible and you have a pipe burst and flood your entire house or a fire devastate half of your home, then it will typically be a wise course to seek assistance with an insurance claim. But what if you have a small leak or a small fire create minor smoke damage, and you are not sure the costs will even exceed your deductible?
We work with many insurance agents that take a serious interest in their customers and care about providing a great level of service to their customers. If you have such an agent, a quick email or phone call (or both) to your agent may just save you a lot of headache. When an agent that we work with receives a call from their customer, they recommend R4 Restoration to their customer. We respond to the call 24/7/365 if necessary and walk through the scope of work with you, identify the general damaged areas, and give you an idea of whether or not a claim would be worthwhile. We take into consideration your deductible amount, the amount of work needed to perform any mitigation, cleaning, or drying needed, the amount of contents handling, and complete reconstruction that will be needed. Most companies that only handle the water damage mitigation or initial water restoration process may not have the ability to properly guide you in your decision since they don’t have the knowledge needed for the reconstruction.
What is Your Claims Record?
Oftentimes I hear insurance companies tell me that after two property claims, the underwriters will decide to non-renew the policy when it comes up to its renewal date. This could mean that although you don’t get canceled right away, once your annual contract is up, they instead decide to not let you renew your policy with them.
What does that mean? If you have a good reputation with them and those claims were not a direct result of negligence or lack of maintenance to your home on your part, then you may be able to speak with your insurance agent about the non-renewal letter you received. Your agent does not want your policy to expire or be labeled as a non-renewal just as much as you. So your agent may try and talk with the underwriters to sway their decision in your case. Also, as with most everything else in this world, it is sometimes tied to your credit. If you have really good credit, you are more likely to get a non-renewal reversed with some companies.
If you are unable to continue with your current insurance company and your agents words had no effect on the underwriters, then you simply have to start shopping around to other insurance carriers. Most smaller or independent carriers are going to be able to insure you with a couple claims on your record as opposed to the larger more “mainstream” carriers. These other carriers may not have as strict policies on who they can write or they may be trying to capture a larger customer base in your area so they are more willing to take on the potential risk that you present to them.
With a poor claims record, you may not only have a non-renewal issue, but you could also be looking at some higher premiums in the future. No matter what insurance carrier you may decide to get quotes from, your record follows you. All carriers have access to the same information, the only difference is how they choose to interpret that information or how aggressively they are looking for new customers. Just beware, the more claims you make, the harder it is to get insurance, and the harder it is to get it cheap.
Do You Have a CLUE?
C.L.U.E. (Comprehensive Loss Underwriting Exchange) reports are compiled by insurers to provide all dates of claims, what insurance companies were involved, your policy, location/property of loss, whether the loss was related to a named catastrophe (flood, hurricane, etc.), and finally, the amount paid for the loss. These reports generally go back five years, however some go back as long as seven years. Once a year, you can order your report for free from research firm LexusNexis. This allows you the opportunity to review the information and dispute anything that you believe to be false.
Beware of Non-Claim Incidents
What is meant by a non-claim incident? It is something that the average person may think would or should be covered by insurance but is not typically covered. Most standard insurance policies do not cover many roof leaks, window/door leaks, sewage backups, slow water leaks, or flooding from outside water coming in. That said, we have seen many of these type things covered by insurance.
These non-claim incidents can be difficult to identify or qualify as real claims for the average person who doesn’t have the necessary claims experience or knowledge of policy. Although R4 Restoration employs several professionals that have worked in the insurance restoration industry for many years, including staff that are licensed insurance adjusters, former agents, underwriters and more, we can only make recommendations to you and help guide you in the decision you make, we do not read or interpret customer policy.
Simply put, make sure that the incident would in fact qualify as a claim before filing a claim. If you do file a claim and it is not a covered loss, you will still have that on your record and no benefit of having that incident paid for.
When would one of these incidents mentioned above, not be a claim? Read the next article to get more insight into what things would not qualify as a claim and what would.
Maintenance issue or a “sudden and instance” loss. Write article about roof leaks, maintenance issues, rot, window leaks, sewage back ups, groundwater flooding, foundation leaks, previously required repairs from insurance company. Also talk about general storm related or act of god incidents versus standard repair work that all homes require and homeowners need to be responsible for themselves.