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10 common mistakes property owners make during an insurance claim

Written by: Sill Public Adjusters

10 common mistakes property owners make during an insurance claim

Navigating through the aftermath of a property loss is both stressful and challenging. It's easy to make costly mistakes while making insurance claims, which can result in reduced settlement amounts or prolonged resolution times.

Here are ten of the most common errors property owners make, followed by insights into the importance of hiring a public adjuster.

1. Failing to Understand the Policy

The first and foremost mistake many property owners make is not understanding their insurance policy in-depth. Policy contracts are often complex and filled with jargon, making them difficult to interpret. However, failing to comprehend what's covered and under what conditions can lead to disputes with the insurance company or a denied claim. So, it is important for you to thoroughly read and understand your insurance policy.

2. Not Documenting Damage Thoroughly

Proper documentation is critical when filing an insurance claim. It includes taking detailed photographs of the damage, making a list of damaged items, and recording their value. Many property owners overlook the importance of documenting every detail, which could lead to a lower settlement or even a denied claim.

3. Making Permanent Repairs Too Soon

Property owners may rush to repair the damage quickly to restore normalcy, but this can be detrimental to the claims process. It's advisable to make only temporary repairs to prevent further damage and wait for permanent repairs until after the insurance adjuster has assessed the situation. If you proceed with permanent repairs too soon, the insurance company might not cover those repairs.

4. Disposing of Damaged Property Prematurely

Similarly, many homeowners dispose of damaged items before the adjuster can inspect them. This hasty action could lead to difficulty proving the extent of the damage, resulting in a smaller payout.

5. Not Keeping Track of Additional Living Expenses

If your property is uninhabitable after a disaster, your policy might cover additional living expenses (ALE), such as hotel bills and meals. However, many property owners fail to keep track of these expenses, resulting in lower claims reimbursement.

6. Miscommunication or Lack of Communication

Communication with your insurance company is vital. If it's reporting the claim quickly, providing the necessary documentation, or keeping them informed about your repairs, communication should be clear and consistent. A lack of proper communication can result in unnecessary delays or misunderstandings about the extent of the coverage.

7. Accepting the First Offer

In their eagerness to settle the claim and move forward, property owners often accept the first settlement offer from their insurance company. However, this initial offer may only partially cover some of the necessary repair costs and other expenses. Reviewing the settlement offer critically is essential, and do not hesitate to negotiate for a more appropriate amount.

8. Failing to Appeal Denied Claims

When a claim is denied, many property owners accept it as the final word. However, denials can sometimes be based on misunderstandings or errors. Therefore, it's always worth it to appeal a denial, providing additional documentation or clarifying information if needed.

9. Not Seeking Professional Help

The claim process can be complicated, time-consuming, and overwhelming, especially when dealing with a significant loss. Many property owners try to handle it on their own, which could lead to mistakes and result in a lower settlement.

10. Underinsuring Property

One of the biggest mistakes made by property owners is not having enough insurance to cover the total cost of rebuilding or repairing the property. This mistake often becomes evident only when a disaster strikes, leading to severe financial hardship.

Why Hire a Public Adjuster?

This is where the expertise of a public adjuster comes into play. A public adjuster is a licensed professional who represents the policyholder in the insurance claim process. Here are a few reasons why hiring a public adjuster is crucial:

  1. Policy Understanding: Public adjusters have in-depth knowledge of insurance policies and can interpret complex language, ensuring you fully understand your coverage and obligations.

  2. Claim Preparation: Public adjusters can help document the loss thoroughly, ensuring no detail is overlooked that could potentially maximize your claim.

  3. Claim Negotiation: With a public adjuster, you have an expert negotiator on your side. They work to ensure that you receive a fair and just settlement, often securing higher payouts than you might have achieved on your own.

  4. Time-saving: Dealing with an insurance claim can be time-consuming. Hiring a public adjuster allows you to focus on recovery while they manage the claim process.

  5. Expert Advocacy: A public adjuster represents your interests, not those of the insurance company. They will appeal denied claims and fight for your rights as a policyholder.

Avoiding common insurance claim mistakes and hiring a public adjuster can make a world of difference in the settlement you receive and the time it takes to receive it. By staying informed and seeking professional help, property owners can navigate the claim process more smoothly and ensure their financial recovery from a loss is maximized.