Successfully filing a home insurance claim can be a huge task. The process is complicated and there are many steps that must be taken in order for the claim to be paid. Since the claims process is so complicated it’s easy to make mistakes that cost time and could prevent you from getting the money that you deserve. Fortunately, these mistakes, which are outlined below, are easy to avoid if you understand the errors that home owners commonly make in the claims process.
Mistake No. 1: Filing an Unnecessary Claim
The first common mistake that homeowners make when filing insurance claims is filing the claim and not understanding the true purpose of home insurance. While a policy may cover relatively minor expenses, it is really intended to give financial protection in the event of major disasters. So while a claim may be valid, it may not always be wise to file it.
Insurers are becoming more selective, so it is in the best interest of homeowners to keep claims at a minimum. For example, some companies will refuse to cover home owners who have any claims in their history at all, and others will raise premiums or fail to renew policies once a file is claimed. Also, it does not make financial sense to file a claim if the policy’s deductible is more than the cost of simply making the repair. Finally, the Comprehensive Loss Underwriting Exchange (CLUE) database, which most home insurers subscribe to, is a record of all claims made against a residence. This information is used to set premiums, much like car insurance companies use driving records. So once again, keeping claims to a minimum is the best option.
Mistake No. 2: Not Contacting the Insurance Agent Immediately
The second mistake that many people make is not contacting the insurance agent right away when something happens and filing a claim is indeed necessary. It is imperative to do this immediately and not waste any time. For one thing, the insurance company may very well want to view and assess the damage for themselves, and it’s best if they can do this as soon as possible. Secondly, the agent is in a position to be able to assist in filing and expediting the claim, so take advantage of that fact.
Mistake No. 3: Not Keeping Adequate Documentation
Don’t overlook the golden rule in filing homeowner’s insurance claims — document, document, document! A successful home insurance claims depends on good documentation. The more evidence there is to support a claim, the more likely that losses will be reimbursed. You should always hold on to receipts and other documentation that proves the value of your items so that it can be submitted to your insurance company when you file a claim. It’s also good idea to keep a record of the serial numbers of your electronics so that, if they’re stolen, you can give them to the police. Submitting the serial numbers greatly improves your chances of recovering items stolen from your home.
Pictures are also a powerful tool of documentation, but it’s easy to not thing about taking any if nothing is damaged. However, it’s a good way to show the condition of an area of your home or a particular item before it’s damaged. It’s also important to take as many pictures as you can of an area of your home that you’ve recently remodeled so that it’s easier for the insurance company to assess any damages after an incident. It may be easy to simply store these photos on your computer and go about your business, but if your computer was stolen then you’d lose all of your documentation. Therefore it’s a good idea to keep your photos on an external hard drive or thumb drive in a safe deposit box with your other records.
Home insurance coverage is a necessity for any homeowner. In the event that it’s necessary to make a claim, avoiding common mistakes can help the process go as smoothly as possible.