Filing A Homeowners Insurance Claim After A Natural Disaster

Natural disasters can do a tremendous amount of damage in a short period of time, and during this time, the safety of your family and friends is paramount. When everything is over, you’re left to figure out how to put everything back together, including your home if it was affected.

If your home sustained damage due to a massive storm, forest fire, earthquake or other cruel event that Mother Nature has thrown your way, one of the most common ways to afford repairs is through your homeowners insurance. However, there are a number of questions at play:

How do I evaluate the damage? Should I file a claim? What should I expect during the claims process? This post aims to answer those questions.

When you get back to your home, the first thing to do is to try to evaluate the type of damage that was done. You’re not a trained insurance adjuster or home inspector, so you may not know exactly how much it will cost to fix whatever damage was done, but you can at least give it the eyeball test.

If it’s safe to do so, take pictures in all areas where there’s damage as well as detailed notes regarding whatever may have happened.

There are a couple of things to consider when determining if you should file a claim with your insurance company. The first is whether or not the damage that was done is actually covered under your policy. After that, you have to decide whether it’s high enough above your deductible to be worth it. Let’s briefly go over both of these.

What’s Covered?

Before you think about filing a claim, you should know what’s covered under your homeowners insurance policy. If the particular damage you have isn’t covered, it’s time to look at other resources. Typically, there are numerous sources of assistance that are available in a declared disaster area.

If you’re unsure about what your policy covers, be sure to contact your insurance provider.

Flooding isn’t typically covered within regular insurance policies. If you live in an area that’s considered a flood zone, lenders and mortgage investors like Fannie Mae, Freddie Mac, FHA and VA may require that you carry flood insurance in order to protect their investment.

They have to make sure your home can be repaired to a standard that’s at least as good as it was before. People that live in forested areas may need to carry fire insurance for the same reason.

Unfortunately, many people who live outside areas that are typically considered flood or forest fire zones don’t carry extra coverage, and disasters tend to affect areas that don’t get hit as hard by regular weather events.

If you’re in that situation, it’s best to look to disaster assistance next if you can’t afford the repairs.

Does Filing A Claim Make Sense For You?

It’s important to realize that once you file a claim with your homeowners insurance, your rates may go up.

This isn’t to say you should never use your insurance. If that were the case, there would be no point in carrying it. However, you should decide if it’s worth it for you to file a claim.

You can figure this out by looking at your deductible — the amount of money the insurance company requires that you pay before your coverage kicks in.

If it’s only a few hundred dollars above the cost of your deductible, it may not be prudent for you to file a claim. You’ll have to make the decision based on your financial situation about how much you’re willing to pay out-of-pocket.

Of course, this relies on having accurate estimate of the damage to your home and how much it will cost to repair. If you’re really not sure, based on your own evaluation, where the repair estimate will be in relation to your deductible, it may be helpful to have someone come out to give you an itemized estimate on the repair cost.

Your insurance company may be able to provide you an estimate for free or with a fee. Contact your provider for information. If they won’t get involved until you file a claim, you may be able to find an independent contractor to do the estimate.

When hiring a contractor to compile an estimate, there are a few things you should look for:

• Is the contractor licensed and insured? Look for reviews and have the contractor provide you references as well.

• Make sure they provide an itemized list of everything that needs to be done and the cost of the work. When they get in there, there’s always the chance they will discover new problems, but the list should be as comprehensive as they can reasonably make it without diving in and doing the work.

• You may or may not have to pay for a contractor to do an estimate. However, never pay them up front to complete any work.

Once you have an accurate estimate of how much the work will cost, you can decide whether it’s worth it for you to file a claim.