Price is the only thing many homeowners consider when purchasing a homeowners policy. Shopping around for quotes online has made it easy for people to buy insurance “cheap”, but this isn’t really the best way to purchase home insurance; especially if the policy leaves you underinsured.
According to a study conducted by Marshall & Swift/Boeckh LLC (MSB), nearly two out of three homeowners are underinsured. On average, homeowners only have enough insurance to cover 78 percent of the cost to rebuild or replace their home. In other words, if the average home price was $100,000, a homeowner would have to come up with $22,000 to have a restoration contractor rebuild their home – despite paying monthly insurance premiums.
Two out of three homeowners are underinsured.
Here are some tips you should follow, so that this doesn’t happen to you.
- Make sure you have adequate coverage. It is recommended that you purchase the highest cap possible for your home. There are several tools on the internet that will help you determine this. AccuCoverage, for example, is a web tool that charges you $7.95 to complete a questionnaire to determine an estimate of the amount of coverage you should have on your home. Take the estimate you get from AccuCoverage and compare it to your current policy; it might be a good idea to sit down with your agent when you do this.
- Don’t skimp on sewer backup and sump pump coverage. This isn’t covered in your standard homeowner’s policy. Often times homeowners ignore this endorsement to save money despite the fact that it only costs about $7 to $10 extra a month. In addition, when purchasing this insurance you should make sure the “cap” is enough to cover the complete restoration of your home. Cleaning up a sewer backup isn’t cheap, and you want to make sure you have enough money to repair your home and replace any unsalvageable contents after a restoration company finishes cleaning up.
- Make any necessary adjustments. You may increase the value of your home when you make upgrades or do any remodeling to it. This may require you to increase your cap. It is devastating to have your sump pump fail, filling your newly-finished basement with water, and finding out that you’ll have to pay the bill for most of the repairs because you were underinsured. Meet with your insurance agent after you complete a remodeling project to review how the upgrades may affect your policy.
When purchasing insurance don’t be cheap. Let your insurance agent know that you want the best possible coverage for the money.
Begin preparing early for spring flooding.
In general, here are the most important calls to make:
- First Responders – Emergency services are likely to be overwhelmed in the event of a flood. Call 911 only if there is an immediate danger to your life and health or that of your family. Otherwise, contact neighbors or friends to help you out (or so you can help each other).
- Utilities – A broken gas line or a downed overhead power line can be a serious hazard after a flood or mudslide. Call the utility company right away to address the issue. Move to a safer area until a crew arrives and corrects the problem.
- Loved Ones – You’ll want to contact family and friends to let them know you are OK and to check on their well-being. In the event of a major disaster, use text messaging when possible to minimize the overload on the voice network. Get in touch with at least one person who lives outside your local area. This individual may serve as an important contact point in getting you the help and information you need (such as the distribution locations for the American Red Cross or local relief agencies).
- Shelter – If your home is unsafe or completely destroyed in a flood, the Federal Emergency Management Agency (FEMA) may be able to provide temporary housing. The number is (800) 621-3362 to register for assistance. FEMA may also have vital information about where to find necessities like food and clothing after a flood.
- Restoration – Once you’ve ensured your family is safe, it’s time to start the process of rescuing your home. This involves contacting your insurance company, submitting a claim and working with a company that specializes in property damage clean up and repair. Most policies require you as the homeowner to make immediate reasonable repairs to your home following a disaster to prevent additional damage and will reimburse you for these repairs. Don’t wait for a contractor to knock on your door (there will be all kinds of fly-by-night repair companies coming through your town after spring floods and mudslides). Be proactive in calling a licensed restoration company that specializes in repairing the specific type of damage your home sustained in the disaster (we suggest Paul Davis Restoration of Macomb & St Clair).
Additional Tips:
The amount of warning you have before an event can also affect your communication strategy. You might be able to make some of your calls ahead of time rather than after the fact. For example, notify your employer that you probably won’t show up for work tomorrow because a major weather event headed your way is likely to cause damage.
And if you know someone who is experiencing a disaster in their own city, be in contact with them and let them know you’re there to help. You may be able to serve as a resource to them even from thousands of miles away.
1. What are my responsibilities when dealing with an insurance claim?
Most policies require homeowners to take specific actions when filing a claim. Failure to fulfill some of these responsibilities could either lead to denial of the claim or it could prolong the claim process. The homeowner’s responsibilities include; securing the property so it is safe, reporting the damage to the insurance carrier within 60 days of the loss, making temporary repairs to prevent further damage from occurring, keeping receipts and bills of any work completed to make temporary repairs, and photographing and documenting all damaged materials and contents. See the post on Homeowner’s Duties and Responsibilities When Filing an Insurance Claim for more detailed information on this subject.
2. How do I file a property insurance claim?
Most policies state that homeowners have 60 days from the Date Of Loss (DOL) to inform their insurance company of damages. When you call your agent or your insurance carrier’s claims hotline and advise them that you have damages and want to make a claim, a claim number will be established; sometimes you will be given it right away, sometimes later. When you are given a claim number, write it down and, this cannot be stressed enough, DO NOT LOSE IT! When you report damages make sure you are specific about what has occurred. The more severe the damage, the higher the priority the claim and the more information available to the insurance company the better they will be able to serve you.
3. How do I know if I should file an insurance claim?
Typically, you only want to file an insurance claim if the cost of repairs exceeds your insurance deductible. If you are uncertain, you should contact a restoration contractor for advice; most reputable firms will offer a free inspection. The homeowner will be responsible for all expenses up to the amount of the deductible.
4. Should I remove anything from my house before speaking with my insurance adjuster?
You should NOT dispose of any damaged items or materials before an adjuster has had the opportunity to look at it. It’s your adjuster’s interpretation of your insurance policy that will determine if the items will be replaced. Your insurance adjuster may end up informing you that the insurance company is not going to replace it.
5. How will my deductible be handled?
Your adjuster will prepare an estimate for the amount it will cost to repair your home. The insurance company will then pay the homeowner the amount of the estimate, minus the amount of the deductible. For example, if the estimate to repair the home is $2000 and the insured’s deductible is $500, the amount the insurance company will pay is $1500 ($2000 estimate – $500 deductible). The homeowner is expected to cover the cost of the deductible.
The Midwest and Great Lakes region presents some of the wildest winter weather. Lake effect snow and cold winds coming down from Canada bring cold temperatures, high winds and heavy snow. At Paul Davis Restoration of Macomb and St Clair Counties we want to take a few moments to talk about how you can help your family, friends and neighbors during the winter months.
- Prolonged power outages can be dangerous for families that are snowed in after a sub-zero blizzard. If you can’t pick up loved ones and bring them to a location that has heat, call to give them some helpful tips for preventing hypothermia. For example, they can wall off a small room with thick blankets to create an insulated space that is easier to keep warm.
- If you have older or mobility challenged relatives, they could be snowed in by even a minor snowstorm. Make sure they know you are coming by to dig them out so they don’t attempt it by themselves. Lay on some gentle guilt if that’s what it takes to keep them indoors until you arrive.
- Sometimes, all an unprepared friend needs to get out of a snowy spot is the right tool for the job. Make a deal that if your friend will cook you a hearty breakfast you’ll bring over your biggest shovel and get their walk cleared before the pancakes get cold.
- Do you have an older relative on a fixed income who is struggling to pay their heating bill? They could be in danger of hypothermia from having their heat cut off while they are snowed in. Many municipalities offer emergency fuel assistance programs that can help keep the heat turned on during severe winter weather. Get online and start making phone calls to ensure that your loved one doesn’t go without.
- Are you an older person looking for ways to help younger friends and family? Young folk may be at a loss for how to make something edible out of the odds & ends in the pantry and fridge when a freak snowstorm hits. If you have a knack for cooking from back in the days when everyone knew how, walk them through some simple recipes over the phone.
- Maybe you are enjoying a balmy weekend in Florida when you find out on Facebook that relatives up north are snowed in. Spend some time online chatting and suggesting ways for them to stay entertained (and how to keep the kids busy). Just don’t talk about how nice the weather is in your neck of the woods. They may un-friend you forever.
The season of good cheer is an exciting time of year. The day after Thanksgiving, lights are already going up all over Metropolitan Detroit. However, the hustle and bustle of the holiday season can lead to all kinds of unfortunate accidents. You already know about the hazards of deep frying a turkey or climbing on an icy roof to put up Christmas lights. So instead, we here at Paul Davis of Macomb & St. Clair County have gone the less obvious route. Here are 8 off-the-beaten-path holiday safety tips to protect your loved ones and your property from dangers.
- FIRE IN THE FLUE: When you’re lighting up the wood fireplace, you have more to worry about than just soot or creosote residue causing a fire in your flue. There’s also the risk of barbecuing a raccoon, squirrel, or bird that’s gotten wedged in your chimney. That’s a good reason to have your chimney swept and cleaned before you light up that Yule log. Just have the chimney sweep check to make sure it’s not Santa stuck up there.
- WARM AND TOASTED: Perhaps you live up north but have your California cousins staying over the holidays. Using a space heater for the guest room may seem like a good way to keep the shivering relatives warm. However, space heaters are involved in 25% of home heating fires (and cause 75% of home heating-related fatalities). It might be safer to simply turn up the thermostat on your central heating to keep everyone cozy.
- WINTER SLIP AND SLIDE: A blizzard can make it difficult to open a door; but even a small snowdrift can make it tough to close your sliding glass door. When you slide the door open, snow that’s piled up on the other side falls down into the track. This creates an icy obstacle in the door track and leaves a pile of snow to melt on your floor, creating a slip and fall hazard. To prevent this, keep the outer sliding screen closed during snowy weather. It will act as a buffer to keep most of the snow from direct contact with your glass door.
- NOT SO WARM TIDINGS: Did you know that homes located along lakes or major rivers can be at risk for flooding during the winter holidays? Winter windstorms can create tidal flooding, ice jams can break suddenly, or an unexpected winter thaw can cause a sudden rise in water levels. FEMA provides a full list of ways to protect your home from flood damage – download PDF here.
- THE DE-ICE THAT’S NICE: De-icing your walkway is a smart safety tip; but it can cause damage to your property. Regular rock salt can harm concrete and kill vegetation. Treat the pathway to your home with more environmentally friendly magnesium chloride instead. Mix this ice melt product with green sand to cut down on salt contamination even further and add a festive look to your walkway.
- GET A WARM GLOW: Christmas lights installed alongside walkways during snowy and icy weather are actually a good safety tool. These lights give off a soft glow at night – unlike harsh halogen lamps that create glare. If you pick a neutral color like gold or white, you can leave them in place even after the holidays are over.
- THE GIFT THAT KEEPS ON GASHING: Cuts from scissors or knives used to open gifts are some of the most common gift-related accidents. Keep your party from turning into a bloodbath by purchasing gifts that are easy to open and avoiding those sealed clamshell plastic packages. Remember, everybody loves a gift bag!
- CLEAR AND PRESENT DANGER: It’s all fun and games at Christmas until someone puts their back out. Cords from holiday decorations and toys can create a spider web of tripping hazards across the floor. Make sure to keep at least one pathway in the front room clear at all times.
Most homeowner’s insurance policies require the policyholder to take specific actions when filing an insurance claim. Many of these requirements are common sense, but the policyholder’s actions or inactions – regarding the requirements of the policy – can determine the parameters of what will be covered and how much of money the homeowner will have to pay out of their own pocket.
Whatever the scenario and regardless of the extent of the loss, the following are crucial steps in the path to restoring your property once it has been damaged.
Safety
Before you call your agent, before you start picking up debris or taking pictures, there is one thing you must do: make sure no one gets hurt. If there is glass inside your home or out on the sidewalk, clean it up; if it looks as though the roof is going to fall in where that giant oak tree landed, get out. Not securing your property after a loss may result in a denial of coverage by the insurance company to anyone who may be injured, a liability claim, leaving you to foot the bill.
Report Damages
Most policies state that homeowners have 60 days from the Date Of Loss (DOL) to inform their insurance company of damages. When you call your agent or your insurance carrier’s claims hotline and advise them that you have damages and want to make a claim, a claim number will be established; sometimes you will be given it right away, sometimes later. When you are given a claim number, write it down and, this cannot be stressed enough, DO NOT LOSE IT! When you report damages make sure you are specific about what has occurred. The more severe the damage, the higher the priority the claim and the more information available to the insurance company the better they will be able to serve you.
Temporary Repairs
If a large patch of shingles are blown from your roof, if a door or window gets blown out, or a water pipe bursts, not only is making any and all temporary repairs to prevent further damage common sense, but according to your policy, it is a requirement. The objective of making temporary repairs is simply to prevent further damages, to prevent a small loss from turning into a big loss or a big loss into a total loss. The insurance word for preventing further damages is mitigation. If a homeowner is negligent in not making temporary repairs, any further damages resulting from that negligence may be excluded from coverage. By making necessary temporary repairs, you are not only being a good homeowner and policyholder, but you’re protecting yourself against an unnecessary denial, the cost of having to make repairs yourself and the possibility of a lengthy lawsuit.
Receipts and Bills
So you’ve been a good homeowner and secured the safety of your property and made any necessary temporary repairs. But you had to call a professional service/contractor to help out and now they’ve given you a bill; or your house was made unlivable and you’ve had to stay in a hotel and eat meals at restaurants.
The most commonly overlooked receipt or bill is the one that homeowners don’t receive, the one they don’t ask for or don’t even think about. If a neighbor or a family friend charges you for any temporary repairs or similar work–tree debris removal, patching your roof, or hauling damaged items to the curb–and you’ve paid them, it is reimbursable. In this situation, ask them to write you a receipt with their name, date, address and phone number on it so you are able to claim it. Any invoices and receipts that you receive make copies and give the copies to the insurance company. Always keep the originals for your own records; this goes for any form of documentation.
Photos/Videos
Photos and videos often make the most dramatic and indelible impression; they tell the story of your loss by framing the damages and resulting repairs into a discernable context and temporal sequence, they provide essential details and general facts that are as integral to a claim as any other form of documentation and often can substantiate and verify other documentation, especially if you’ve had to make temporary repairs. It goes without saying, but if you do make temporary repairs, you’ll want to take photos of the affected area(s) beforehand.
may sound strange to some, but often the most important photos or videos a homeowner may ever take is before any damage occurs: in a case of a total loss, fire, hurricane, tornado, earth quake or even a smaller loss, having numerous photos and/or videos showing undamaged building and personal property, interior and exterior structural details, the materials used in construction and the overall layout of your dwelling as well as any outbuildings can expedite your claim, answer any questions that may arise and aide you in the unbearable task of remembering every little detail of your house and what was inside it. While most homeowners never think of taking photos or videos of a home for the sake of general documentation, it is something that every homeowner needs to do. But taking pictures and videos aren’t enough: make sure that copies of any photos or videos are stored in a fire-resistant safe, a safety deposit box or a secure on-line server.
Damaged Property
So you have this pile of stuff that used to be attached to your house and you’re not quite sure what to do with it. Instinct says pitch it, lob it onto the curb and wait for the siding and shingle undertaker to do what you wish he could do with the rest of your problems and make them disappear.
Santa Claus has it right: make a list, check it twice, though we can forgo the naughty or nice part, ’cause everyone’s a little naughty some of the time. Once you’ve secured the premises, made temporary repairs, and taken pictures, take out paper and pencil and begin to list everything that was damaged everything–not just roof, siding, gutters, carpet, etc., but look around and see if your patio furniture, flower pots, bird houses, anything outside or inside, was damaged: furniture, blankets, pillows that may gotten stained or soiled when your ceiling or walls leaked. Except for your lovely plants and trees (which if you were paying attention, are only covered in certain circumstances), it’s all covered and needs to be documented. If possible, list building/structural and personal property items separately. Homeowners have a duty to prove their loss and under most policies they are required to display the damaged property at the request of the insurance company. If you can help it, don’t throw anything away, but more importantly, don’t have a contractor or other person make permanent repairs before the insurance company inspects the damages.
Your Time and Expense
Any work you or your relatives perform due to an insured loss, temporary repairs, safety measures, tree or other debris removal, and which is not part of routine maintenance, upkeep, and cleaning, can be claimed. Most of the materials purchased for these tasks can also be claimed, but with limitations. The general rule is if the materials are applied directly to the damaged property/area, they can be claimed. For example: if a tree branch punctures your roof, the tarp used to cover the hole, as well as nails or screws to attach the tarp can be claimed, but not the ladder you had to buy to access the roof.
The key to getting paid, naturally, is documentation. If there is occasion for you to perform necessary labors such as temporary repairs and debris removal, start a Log in your claim file or folder and list out the dates and number of hours each person worked and note what general task they performed. The more specific you are as to what each person did and when he did it and how much time he spent doing it, the quicker your claim will be resolved.
The claims process can be a very confusing experience for most homeowners. However, taking the time to organize yourself can help expedite the process and make your job, and the job of your adjuster, a lot easier.
Water stains caused by a toilet leak
Situation:
A homeowner noticed some water staining on the ceiling of his main floor hallway. He wasn’t able to identify the cause of the water stain and filed a claim with his insurance company to resolve the issue. The homeowner’s insurance company contacted us to inspect the job and perform all necessary mitigation services
Problem:
Our water mitigation technicians were able to identify the cause of the loss as being a toilet leak in the second floor bathroom. After further inspection, our plumber was able to identify that the cause of the leak was a broken wax ring beneath the toilet base.
Solution:
Repairing the wax ring was an easy fix, but the damage caused by the leak was more extensive than what one might assume. The subfloor beneath the ceramic tile was wet and needed to be removed. In addition, because the bathroom vanity was sitting on the ceramic floor, the vanity and the sink needed to be detached and removed. Air movers and a dehumidifier were used to dry the subfloor.
The main floor ceiling also needed to be dried out. To do this our technicians needed to remove a 4 X 4 piece of drywall from the ceiling in order to inject warm dry air into the ceiling cavity (the area between the drywall and subfloor) using a dehumidifier; this action was required to effectively dry the bottom side of the second floor subfloor and floor joists.
Outcome:
The structure was dried within 3 days.
I recently had an interesting debate with some colleagues about the ethics behind the practice of discounting an insured’s deductible. Is it a good idea for restoration companies to offer discounts – up to 100% at times – to help the insured with their deductible? Or, more importantly, is it an ethical practice?
Initially, though my company does not offer these kinds of discounts, I saw nothing wrong with this practice as long as the contractor did not build the discount into the estimate; thereby making the insurance company pay for it. However, there was an error to my thinking that one of the forum’s participants helped me see. According to Tom Doise, owner of Paul Davis Restoration of Acadiana, there are certain scenarios when discounting a deductible is okay, as well as scenarios when it is not. I’ve outlined these scenarios below.
Photo courtesy of http://www.vergemagazine.com
When discounting a deductible is ethical
Sometimes the insurance adjuster completes the repair estimate on his/her own or has another company complete it. If the insured has been paid based upon this estimate, it’s perfectly reasonable for them to ask for a lower price. For example, if an insurance carrier pays its insured $10,000, based on the adjuster’s estimate, and the insured had a $500 deductible, the insured has every right to ask a contractor to complete the job for $9,500.
When discounting the deductible is unethical
The practice of discounting the deductible is deemed unethical if the insurance company is issuing payment based upon the estimate of the contractor who is doing the actual repair work. This is clearly illustrated by the following example; if the contractor communicates to the insurance carrier that he can repair the insured’s home for $10,000, but he later makes an offer to the insured to repair their home for $9,500 ($10,000 minus the $500 deductible) he has just participated in insurance fraud. In this instance, the contractor knowingly helped the homeowner deceive the insurance carrier by writing an estimate for an amount more than he intended to charge. The insurance company (depending on the type of policy), according to their contractual agreement, is obligated only to pay the cost of repair minus the deductible.
The difference between these two situations mentioned may seem subtle, but the ability to make a distinction between the two is critical for restoration companies who strive to maintain a high level of professional integrity.
It’s a common misconception that water damage only happen after heavy rains. Anyone can be a victim of water damage. Whether it’s a broken pipe or a drain backup that is the culprit, water damage can occur to anyone’s home or property at any time; however, homeowners can reduce the likelihood of experiencing such disasters if they commit to a simple schedule of inspections.
You can reduce the chance of water damage by completing some simple inspections
Sump Pump
Testing your sump pump is an easy task and should be done on a monthly basis; especially during wet seasons. You can test the sump pump by pouring a bucket of water into the pump’s well. If you do not hear the pump switch on after water is poured into the well than you may want to consider calling a plumber to take a look at it. In addition, it is highly advised that homeowners install a backup system with their sump pump because it will enable the pump to function during power outages; though for a limited period of time only. These systems come in a wide variety and can be purchased at most hardware stores.
Sewer Drains
It’s recommended that homeowners snake out their sewer drains on an annual basis. We’ve heard people advise homeowners to pour a gallon of water into their drains to see if the water drains properly, but this test is insufficient for pipes that have a blockage further down the line. Especially vigilant homeowners can further reduce the likelihood of drain backups by installing a stand pipe or flood guard on their drains during periods of rain or particularly wet months.
Air Conditioner
Central air conditioning units should be inspected and maintained on a yearly basis. The air conditioner pan drain line can clog up causing the pan to overflow. It’s recommended that homeowners contact their HVAC contractor to perform this inspection.
Supply Lines
Property owners should check supply lines once a year; this includes supply lines to your sink, toilet, refrigerator, ice maker, dishwasher, and washing machines. If the line is plastic or if it appears corroded it should be replaced immediately. We suggest replacing the supply lines with a more durable braided stainless steel line.
Roofing
It is important to inspect your ceilings on a regular basis. Any bubbling of paint or water staining on the ceiling’s drywall is an indication that you have a roof leak. Homeowners should contact a restoration company and/or a roofing contractor immediately to have this problem fixed.
If homeowners follow these simple routine home inspections they can significantly reduce the likelihood that they will experience serious water damage to their homes and property. None of these suggestions involve rocket science, but they do require some vigilance and careful planning.
Drain backups are more prevelant with the arrival of spring. Though it is great to see the temperature on the thermometer break 40F, the falling rain and thawing ground are causing problems for some property owners. One problem that we at Paul Davis Restoration – Macomb & St Clair Counties are being called in to clean up after is drain backups. These types of water loss are some of the most costly losses for insurance companies because sewage water is involved and insurance protocal dictates that most effecte materials be removed and replaced. However, there is a product on the market - called a flood guard - that can greatly minimize these occurences and it can be purchased for less than $20.
Flood Guards are an easy an inexpensive way to prevent coslty sewer backups.
The Flood Guard works like a check valve. It allows water to pass into the drain, but it prevents water from backing up. The Flood Guard has a float that rises if the water begins to back up; sealing the drain until the water level lowers. This wonderful piece of hardware is not a full proof solution to serious drain backups, but it will greatly minimize the likelihood of floods caused by drain backups. In addition, they can be found at almost any hardware store and are easy to install.
