Homeowners insurance is something you pay for and hope that you never have to use. However, it is there for a reason, and when something happens to your home, you will need to understand how to deal with homeowners insurance claims.
General Types of Claims
There are two major types of homeowners claims and they will be based upon the extent of the damage done.
Minor damage claims: These are simple claims that would include something like a broken window or lost siding. In the case of a minor damage claim, the most likely course of action will be for you to get an estimate of the cost and then have the job done. The insurance company will then pay the cost minus any applicable deduction.
Major damage claims: A major damage claim will be much more involved. It will require an adjuster to come out to your home or property and evaluate the extent of the damage. The adjuster will take photos and then provide you with a course of action that will most likely involve getting estimates and filling out the necessary forms. There may also be a discussion as to whether it is cheaper to repair or rebuild.
A major damage claim can be very time consuming as there will be much interaction and discussion with your insurance provider. Large sums of money are at stake and it may be in your best interest to hire an attorney who specializes in homeowners insurance claims.
Claims Settlement Methods
If the time ever comes when your home is destroyed beyond reasonable repair and must be rebuilt or replaced, there are two general types of settlement methods. It is important to understand these methods when you are choosing your homeowners insurance coverage.
Agreed Loss Settlement: When your house is lost because of a reason covered by your homeowners insurance policy, you will receive an amount that is equal to the total that is stated on the Declarations page of your homeowners insurance policy minus your deductible. This is the most common settlement method and standard on most homeowners insurance policies.
Optional Replacement Cost: This is an optional coverage that will increase your premiums but has some advantages. If you lose your home because of a reason included in your insurance policy, then you will receive an amount based upon the actual cost of replacing personal property items and the new property at the current prices. Most policies cap this amount at 120 percent of the agreed loss settlement.
Tips to Reduce Claims
Neither you nor your homeowners insurance company like to deal with a claim. It can be tedious, frustrating and it costs both sides money. While you can never stop all homeowners insurance claims, there are a few helpful tips to reduce the chances of having to file a claim.
Check your roofing: It is a good idea to regularly check the roofing of your home. Issues with your roof could lead to a major homeowners insurance claim. A small water leak in your roofing that may not be noticeable inside your home could cause severe damage to the rest of the roof and to the frame of your home. Every 6 months you should perform a thorough inspection and always keep an eye out for signs of problems.
Don’t Smoke: Fires caused by cigarettes are a major cause of homeowners insurance claims. If you are a smoker, you are increasing your risk of having to put in a claim against your policy. Also, smokers generally pay higher rates on their insurance for this reason.
Perform a check on your home’s internal systems: An evaluation of your home’s plumbing, electrical and septic systems can help to spot potential problems before they happen and thus reduce the likelihood of a major claim.
Regular smoke alarm checks: Smoke alarms not only save lives but they save money as well. Simply having a certain number of them will lower your homeowners insurance premiums. They can also help by allowing you to spot a small fire before it gets bigger, thereby reducing the size of a claim due to fire and smoke damage.
Get Homeowners Insurance Quotes Today
You can now use our homeowners insurance finder tool to compare the rates and policies of many different homeowners insurance companies in your area. This is an important early step in finding the right homeowners insurance for you and a great way to save money.