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Why You Shouldn’t Accept the Homeowners’ Insurance Claim Offer

When you’re dealing with catastrophic damages to your home, you likely just want the claim process to be over with and to start rebuilding. Repairing your property, replacing furnishings and paying extra expenses that you incurred weighs heavily on your mind and hearing that your claim has been approved and a check is on the way feels like a step closer to “normal”.  But there are several reasons why you may not want to accept their offer right away.

The adjuster’s appraisal might not cover all the costs to get the job done right. First, it is important to understand the difference between an insurance adjuster and a public adjuster. The big difference is that the insurance adjuster is paid by the insurance company and a public adjuster is one you hire to work for you. The latter is usually done on a contingency basis, so the bigger the payout you receive, the more they make.

Both adjusters will examine the damage, taking into account a number of factors including material costs, prevailing labor rates, labor hours, profit and overhead and the damage description.  However, a public adjuster has a bigger interest in getting you the compensation you deserve and will likely go further to justify the claim amount, including getting quotes from various contractors who would properly repair your property.  An insurance company may offer what they think is fair based on their adjuster’s findings and offer contractors who will repair it for their price. That doesn’t guarantee it would be repaired to your satisfaction. Remember that you can choose who will repair your property.

The low offer might be due to coverage issues.  Your insurance policy is a contract that is built on multiple provisions, conditions and exclusions, resulting in a complicated plan.  Because of all of these layers, it is easy for an insurance company to find a coverage issue.  Instead of a settlement offer, the company may send you a Reservation of Rights letter outlining potential policy violations, increased hazards, fraud indicators or other coverage problems.  Rather than declining coverage for your claim, the coverage issues become a reason for lowering your payment expectation, hoping that you’ll settle for a percentage of your claim rather than the full amount. If your claim is underpaid, we can review your case for free and make a plan to fight for the compensation you deserve.

Not all damage is evident immediately.  The insurance adjuster offers a property settlement based on the facts that are known such as damaged roof.  When the damage is extensive, there are likely to be a lot of unknowns not included in the assessment including damage in the interior walls that is undetectable until the work begins, mold or mildew that forms from water used to put out a fire and other scenarios.

Finally, depreciation is negotiable.  When an insurance company owes actual cash value for your destroyed contents, the amounts they offer are not set in stone. Adjusters rely on programs and charts to calculate depreciation based on average life-expectancy of your property and their age at the time of damage, not taking into account adjustments for barely used or well cared for items which will give you leverage in disputing their settlement values.

Evaluate the offer thoroughly and call us at 844-96-CLAIM to review your underpaid claim today.

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Are Plumbing Repairs Covered by Homeowners Insurance?

The easy answer to that question is, that depends.

In many, if not most, cases, as long as you are unaware of a problem and the plumbing suddenly springs a leak, your homeowners’ policy should cover it. There is a catch, however; while your policy may cover water damage because the plumbing leaked, it is unlikely they will pay to repair the leak itself. Because of that, you may find the insurance company will cover the damage, but you’ll have to foot the bill for making sure it doesn’t happen again.

In summary, while your homeowners’ insurance policy will likely cover any water damage you may have due to plumbing issues, it most likely will not cover the repairs to the plumbing system itself.
Check Your Policy and Know Possible Policy Exclusions

Every homeowner should always be at least generally aware of what is and isn’t covered by their homeowners insurance policy. When something happens, you will experience greater peace of mind if you know what is likely to be covered in advance of your claim. To understand more about the types of damage your homeowner’s policy covers from the start, you should contact your insurance agent to discuss. If you’re worried about what your insurance doesn’t cover, give your insurance agent a call to find out what kinds of additional coverage may be added to your existing policy, such as coverage to pay for damage to your home caused by sewer and drain backups, which is not typically covered under a standard plan.

Most standard homeowners’ insurance policies come with common coverage limits and exclusions. For example, generally speaking, homeowners policies won’t cover damage caused by pipes that freeze and burst if your home is unoccupied at the time. You should also check to see if your policy includes a maintenance clause. If it has one, and you suffer damage that is caused by a condition easily fixable and which would have prevented major damage, the insurance company may decide to reject your claim, or they may pay the claim, then raise your premium.

At least one major study has determined that plumbing leaks and broken appliances are the most common causes of household water damage, since more than half of damages come from a broken pipe or a leaky appliance hose. As noted, most policies will cover the water damage from a hose that leaks or bursts, but won’t pay to repair or replace the hose or appliance. You are also responsible for paying any deductible that applies in those instances.

Prevent Future Problems and Coverage May Not Matter

Regardless of your homeowner’s insurance, you will want to protect your home from unnecessary (and potentially uncovered) water damage, which means taking simple steps now that can prevent a big headache later. For example, only operate appliances when you are at home. That way, if something goes wrong, you can easily shut off the water supply. In addition, perform regular maintenance, like checking appliance hoses for wear and tear. By conducting regular inspections, you can detect problems early, when they are cheaper and easier to fix.

If at all possible, invest in affordable, steel-braided hoses, which are available at home improvement and hardware stores, because they are more durable than rubber hoses. They are easy to install, and they can prevent a lot of problems later on. Also, to prevent damage from frozen pipes, always allow them to drip slowly when the outside temperature drops below 20 degrees Fahrenheit, and if you’re going to be away for an extended period during a cold spell, drain the water from your pipes as a way to prevent damage if pipes freeze.

Put simply, taking steps to prevent problems means it may not matter what your homeowner’s policy covers or doesn’t.

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How to Properly Document Damage for a Homeowners Insurance Claim

Following a fire, flood or any type of disaster, you probably have plenty of anxiety and stress. The last thing you want to do is to be reminded of everything you lost. However, you will also want to file a claim with your homeowner’s insurance – that’s why you pay the premiums every month – so you can recover enough of your losses to feel whole again. To do that, you will have to document everything you lost before you file a claim with your insurer to recover for property damage.

 

Before you make a homeowner’s insurance claim, it is also a good idea to track every conversation with the insurance company.  Take detailed notes on every action related to your claim and keep the notes in chronological order, starting with the time and date of the loss, the cause of the loss and what was damaged. Note the exact time and date of the loss, what happened, what was damaged and other relevant details. Every time you have an appointment with the adjusters, contractors and everyone else related to your loss, take lots of notes.

 

Just as important as keeping close track of every interaction you have with your insurance company, however, is making sure you can account for the damages you have suffered, including all details and anything that may have an effect on the overall value of your claim. You can’t expect an insurance company to simply write you a check based on your quick accounting; you need to make a case for every dollar of the loss you’re claiming.

 

Damage to the Dwelling/Structures on the Property

 

The first thing you should realize is, you must report any damage you plan to claim as soon as possible after you become aware of the damage. One of the most important aspects of any successful homeowner’s insurance claim is prompt notice. You should take pictures or video of the damage as soon as possible after the event, so as to document the damage. Be as thorough as possible. When you take the pictures, use natural lighting to the extent possible and take multiple photos from various angles. You should also keep a log of all damage you find as you find it, including the date and time and a detailed description of the damage and exactly where it was found, and whether or not you contacted someone at the insurance company.

 

Damage to Personal Property or the Dwelling’s Contents

 

Once again, if personal items like furniture, electronics, art, jewelry, carpets and rugs and the like were damaged, take numerous photos of each personal item and keep a log of all items that suffered damage. No matter what, however, do not discard any items. Instead, store them in a safe space, like a garage or a shed, or rent a storage locker. You have to keep the items available for the insurance company’s inspection. Take a complete inventory of all damaged items, including descriptions of each item and the extent of its damage, and assign a value to each one. Make sure the descriptions include the date of purchase, model number, brand, serial numbers and all warranties. Any receipts from the original purchase of the damaged item are always very helpful. If possible, photos of the items before the damage usually turn out to be very useful for the insurance company, so if you have those, include them, as well. They can be family photos showing you using the item; anything to show the items before the damage.

 

Account for Lost Rent or Additional Living Expenses

 

Suppose the damage to your home is extensive enough to require you to find temporary housing and make arrangements for meals. Keep a record of every expense in those cases, including hotel bills, meal receipts, cancelled checks, text messages and email conversations detailing the arrangements you had to make. Keep several copies of these documents and make sure at least one is filed with the insurance company as evidence of your claim. The same would apply if your property is a tenant property and the damage forces you to relocate some of your tenants. You can recover in either case, but you must provide every detail to the insurance company.

 

It is important to track every expense caused by the event that led to your loss, at least until the claim is closed and you have been compensated for your losses and damages.  Until everything has been resolved, you will never know when the insurance company will ask for proof of something. Tracking every loss is a difficult prospect, so consider hiring experts to come in and evaluate your losses. It may save you money in the long run.

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Why You Should Consider a Home Electrical Wiring Upgrade

Upgrading the wiring on a home can indeed be quite messy and expensive, but there are times when it becomes necessary, as a way to make sure the home is safe and to maintain its value. Even if the TV and the lights turn on as they should and the refrigerator keeps food cold, there are times when that is not sufficient in determining whether your wiring needs an upgrade. If your home is more than 40 years old, you may still need to be upgraded electrical wiring for safety reasons, or because the existing wiring no longer meets your family’s power needs.

There are Many Safety Issues with Older Wiring

According to a study by the National Fire Prevention Association, faulty wiring is the leading cause of residential fires in the United States. The older your home is, the greater the chances that the wiring might be outdated or unsafe. That doesn’t mean old wiring is inherently dangerous, but unless you were around when the original wiring was installed, you can’t be sure the electrical system is up to code. There is also the fact that some materials, especially the insulation on the wires, can deteriorate with time. The one thing to keep in mind is, you won’t necessarily get a warning that it’s about to start a fire. Also, if your wiring is old and you don’t upgrade, some homeowners’ insurers may refuse to cover the home, which could pose a problem if you decide to sell.

If you have no idea when the wiring in your home was inspected last, it’s probably worth it to pay a licensed electrician to check it out. If you have experienced any of the following, you should certainly have an inspection:

  • Fuses that blow repeatedly or breakers that constantly trip;
  • Lights that flicker or are dimmer than they should be;
  • If there is a persistent burning smell coming from a particular appliance or from a room;
  • Electrical outlets that are warm or discolored, or which occasionally spark;
  • Two-prong ungrounded outlets throughout the home;
  • No ground fault circuit interrupter (GFCI) outlets in kitchens, baths, and other rooms that are exposed to excess moisture.

 

Have Aluminum Wiring? Inspect!

Back in the 1960s and 1970s, many homes were built using aluminum wiring instead of the traditional copper wire, as a money-saving measure. These days, aluminum wiring is considered a safety hazard because connections tend to loosen up over time, which can cause overheating and possible fires when appliances are plugged into receptacles. At the very least, in a home with aluminum wiring, an inspection can determine whether it’s safe to leave the wiring in place. Short of a complete upgrade, it has been found that the addition of copper connectors called pigtails, at receptacles and circuit breakers, can fix potential problems.

 

Sometimes, You Need More Power

Whereas 60 amps used to be the standard for household power, these days it is not uncommon for a house to need to run 200 amps because some appliances, air conditioners, flat-screen TVs, computer equipment needs it. That includes many other gadgets that our parents and grandparents couldn’t envision when the electrical wiring was being installed in your home. And it’s more than just inconvenient; running with insufficient power can cause serious damage to many sensitive electronics. Even with adequate power, you may need to add outlets so as not to rely on power strips and extension cords, which can be a potential safety hazard.

So, if the electrical system in your home isn’t adequate, you face the very real possibility of a house fire or electrocution of a family member or a visitor, and your homeowner’s insurance may not cover that. Even if a disaster doesn’t happen, you could end up frying a lot of expensive electronics.

 

Law Firm of David Low and Associates, P. A. | 844-96-CLAIM

DISCLAIMER: The information in this article is purely for educational purposes, reflective of the time it was published. It is not to be understood as legal advice.

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