I have been writing recently about a major fire that occurred at one of my properties recently. I wrote about the initial incident, surveying the damage on the day after and dealing with the tenants. In this post I want to talk about beginning the process to rebuild the property. Specifically, beginning the insurance claims process and dealing with the insurance company.
First let me say that I normally do not make insurance claims. My belief is that insurance is there only for a catastrophe, not for minor problems such as a defective heating system of roof leak. This fire was of course a major catastrophe, so placing a claim with my insurance company was in order.
Before starting the claim process there are several things that smarter landlords should do and think about before getting things rolling.
- Be completely honest about what you know when talking with your insurance company. Don’t try to inflate the damage or increase the claim.
- Call your insurance agent first and ask their advice instead of calling the general 1-800 number. Your agent can provide you with valuable advice and contacts within the company that may make the claims process much easier. They may also be able to get the claims process going faster by calling it in themselves.
- Remember that insurance companies are for profit companies. They make money by collecting premiums and denying claims. Understand that they are going to conduct an investigation into what happened and what you are claiming. So think carefully about what you are saying at all times when speaking with your insurance company.
- Call a trusted attorney and discuss your claim with them as well. Ask for advice on dealing with the insurance company and starting your claim. An attorney can be very helpful through this process, especially if things start to head south.
- Start a journal of your fire event. In this journal keep a record of all contacts, discussions, etc. Trust me, this will come in handy later.
I called my insurance agent the very next day after the fire. Through my agent, I got a number for the claims department and made the call. They were very responsive and professional. They gave me a claims number and said an adjuster would contact me shortly.
The adjuster called me the next day and set up an appointment to view my property’s damage the day after that. The process was moving very quickly which both surprised me and made me happy. I was surprised the insurance company would move that fast and of course happy that they were.
So what is the purpose of the adjuster? Their job is to estimate the amount of the damage and determine what it would cost to repair, replace and fix the damage. They will take measurements, take pictures and in general examine every detail of the damage and make a report back to the insurance company.
You should always meet the adjuster at the property and go through it with them. Pay attention to what they do and say. Take notes. Be sure to point out how expensive replacement materials will be. Make sure they note that floors are hardwood instead of carpet, tile instead of vinyl, that the counters were granite rather than Formica and so and so on. Remember, you want to get what you are due to rebuild and restore your property. Remember also that the insurance company will be trying to save money. So you need to stay on top of them and make sure that they record accurate information.
Overall the adjuster spent about two hours going through and examining my property. He stated that he would need a couple of days to finalize his report and he would be in touch then. Until he finished his job, there was really nothing I could do other than keep the property secure and begin to think about rebuilding. It was time to start getting estimates.
Next time, I’ll write about what the adjuster reported and how the insurance company settled my claim. Was I in “good hands” as they say? Stay tuned.
