How to File a Homeowners Insurance Claim

Once the claim form has been completed and filed, you will be assigned an adjuster by your insurance carrier. Your adjuster is an important partner in the claims process. They are there to help things move along smoothly and to assist you with any questions, concerns, or needs as they arise.

Your adjuster is also responsible for determining whether your home is a total or partial loss. If they determine that your home is a total loss or uninhabitable, then the Additional Living Expenses (ALE) component of your homeowners insurance policy will typically cover the expense of securing temporary housing, as well as many other expenses, while your home is rebuilt. It’s important to keep all receipts for any costs that are over and above your normal living expenses, such as hotels, restaurants, pet boarding, moving costs, additional transportation fees, etc., to ensure that you are properly reimbursed.

On the other hand, if your adjuster determines that your home is only a partial loss, and that it is livable, then it’s your responsibility to implement temporary measures to prevent further damage. For example, cover any holes in your roof or broken windows with tarp or plastic. Again, make sure to keep all receipts. Plus, do not throw away any damaged items until your adjuster has a chance to review them.

In order for your adjuster to correctly estimate damages to your home and belongings, they need to understand everything in your home that needs to be replaced. So, they are going to take their time inspecting your home and will be as thorough as possible, which could take a couple of hours or an entire day depending on the extent of the damage. To help this part of the process go more smoothly, it is extremely helpful to provide the adjuster with a pre-incident home inventory that will give a “before” picture of your home. We also encourage you to be present for any inspections of the damage so that you can ask questions and request copies of any inspection reports that they produce.

While it’s your responsibility to hire the contractors to repair your home, your adjuster will again serve as a critical advisor, especially in developing the scope of work document, which is a detailed plan for the rebuilding process. Your adjuster reviews your previous floor plan, square footage, and interior finishes, such as flooring, countertops, cabinetry, molding and plumbing, and will make sure that materials of a similar kind and quality to the originals are being used in the rebuilding process, subject to the limits and terms of your home insurance policy.

After you agree to the cost of damages and the scope of work, and accept the settlement proposed by your adjuster, you will receive a payout from your insurer. Occasionally, homeowners will receive a single payment. But, because the standard homeowners insurance policy includes several separate coverages, including Dwelling Coverage, Coverage for Detached Structures such as a garage or shed, Coverage for Additional Living Expenses (or ALE), and Coverage for the Contents and Personal Possessions in your home, it’s more likely that you will receive multiple checks from your insurance company for these different losses. If you are not clear on what each payment is for, ask your adjuster. That way, you can designate it to the correct repairs, the appropriate replacement item, or to reimbursing your bank account for approved additional living expenses you paid for out of your own pocket.

Homeowners are often very surprised at this stage of the claims process to see that their mortgage company’s name is listed as a payee on their settlement checks. This is intended to ensure that claimants spend their insurance payout responsibly, e.g. on home repairs rather than on a trip to Hawaii. It’s also very common for your lender to require you to fill out several forms before funds can be released, and often these payouts are provided in stages as work is completed. Thus, it’s very important to contact your mortgage holder to inform them of what has happened and to find out what their process is for paying out insurance proceeds to contractors. Remember, while work is being done to your home, you need to keep paying your mortgage, property taxes and home insurance.

It’s understandable that some homeowners may think that, after they experience a loss, their insurance coverage should be reduced. You, of course, don’t want to waste money on insuring things that don’t even exist anymore. However, we strongly advise having a thorough conversation with your insurance agent first. Things to consider with your insurance professional include how quickly you think you’ll replace furniture and high value items, if you are definitely rebuilding your home or if you are thinking of buying a replacement home elsewhere, and could someone get injured on your property while it’s uninhabited. After discussing these factors, and many others, you and your insurance professional can determine the appropriate level of coverage for your home and property during the rebuilding process, if that’s what you’ve chosen to do, as well as for any temporary residence. In addition, when your home is rebuilt, your insurance needs should be reevaluated again as the value of your “new” home is probably going to exceed that of your pre-loss one.