Insurance Claim

Floods happen with great regularity in the United States. In recent years, we have witnessed entire cities underwater in the spring floods along the Mississippi River. However, floods can happen in unexpected areas and for unexpected reasons. Congress created the National Flood Insurance Program (NFIP) to provide insurance protection for the hazard of flood.

The standard homeowner policy (HO-3) defines flood as follows:

“...A general and temporary condition of partial or complete inundation of normally dry land areas due to:
1. The overflow of inland or tidal waters;
2. The unusual or rapid accumulation or runoff of surface waters from any source; or
3. Mudslides.

Remember Hurricane Katrina? The hurricane winds blew flood waters into areas that had never had floods before. The insurance industry denied thousands of claims, attributing the damages to flood. Thousands of property owners who were nowhere near a flood plain had their claims denied because they did not have flood insurance.

So, here are seven common myths about Flood Insurance.

Myth #1: Homeowners, renters, and business property insurance policies cover flood damage.

No, homeowners, renters, and business property insurance policies do not cover floods. The NFIP policy is a separate policy that does cover flood damage to a home or business. Contents coverage can also be added to the flood policy. Policies are available to property owners as well as property renters, whether home or business.

Myth #2: Only homeowners and business owners can buy flood insurance.

Fact is that most homeowners, renters, condo owners, and businesses in NFIP participating communities can buy flood insurance. Policy limits are:

• Home and Condo Owners - $250,000 in structural coverage, $100,000 in contents coverage
• Renters - $100,000 in contents coverage
• Business owners and renters - $500,000 in structural coverage, $500,000 in contents coverage

Myth #3: You can’t buy flood insurance if you are in a high-risk zone.

Fact is that you can buy NFIP coverage no matter where you live, as long as your community participates in the NFIP.

Myth #4: You can’t buy flood insurance if you’ve been flooded before.

Fact is that as long as your community participates in NFIP, you can buy flood insurance.

Myth #5: You can’t buy flood insurance immediately before or during a flood.

Fact is that you can buy NFIP flood insurance any time. There is usually a 30-day waiting period before the effective date of the policy. Also, the policy does not cover a loss in progress, which is defined in the policy as a loss occurring at midnight on the date your policy goes into effect. So, the new policy won’t cover past or current losses, only losses after the policy goes into effect.

Myth #6: If you live in an area that is not a flood zone, you don’t need flood insurance.

Fact is that floods occur regularly in places that are not mapped flood zones. 25% of NFIP’s claims come from low-to-medium risk zones. On the other hand, if you live in a flood zone, you likely cannot finance a home loan without buying flood insurance.

Myth #7: FEMA disaster assistance will pay for flood damage.

Fact is that unless your area is declared a disaster area, there is no FEMA assistance. Fewer than 50% of floods are declared a disaster area. And, if you don’t have flood insurance when the flood occurs, you will have to buy and keep flood coverage to be eligible for future benefits.

Don’t allow your property to be damaged by flood without having the proper insurance coverage. Get the coverage you need, and don’t wait any longer.

For all the details about Flood Insurance, go to: www.floodsmart.gov

The Southern California wildfires are causing the largest population evacuation in California’s history, and over $1 billion dollars sofar in property damage. Once the TV cameras leave the damaged areas, the property owners and policyholders will have to get busy with the process of filing insurance claims.

I’m Russell D. Longcore, the nation’s foremost authority on property insurance claims. I’m the author of the book “Insurance Claim Secrets REVEALED!” My book shows consumers how to take control of their insurance claims, and collect hundreds or even thousands more dollars in their claim settlements.

I spent the last 15 years of my 34-year insurance career in the claims adjusting side of the business. I became increasingly sickened by the ways that insurance companies minimized, shrunk, depreciated and flat-out denied claims that they knew were legitimate claims. So, I wrote a book showing consumers how to take control AWAY from the insurance companies. I know ALL the tricks, and I reveal them in my book.

Writing that manuscript got me fired from an international claims adjusting company! What kinds of information is in this book that scares the adjusters and insurance companies so much?

So for you, the reader of this article, I have posted a Top Ten List of crucial steps in the claims process. Then, I wrote and posted a complete article about each of the Top Ten.

Most people don’t read their insurance policies. Even when they try to read them, they find them frustratingly complicated. Insurance policies list what you must do to file a claim, but they NEVER tell policyholders HOW to do it.

The “devil” of the claim is in the details of the claims PROCESS, and the insurance companies hardly EVER explain the process. If they did, it would cost them millions more. Insurance companies do whatever they can to control the CLAIMS PROCESS. But, if you learn the CLAIMS PROCESS from me, you'll be able to take control of the process away from the insurance companies, and add hundreds or even thousands more dollars to your claim settlements!

Insurance companies will pay the least amount of money that the policyholder will accept to settle the claim. But, if you allow the insurance company to handle your claim for you, how will you ever know whether you got ALL you were entitled to collect?

Let me share some of these strategies with you.

1. For the hundreds of thousands displaced from their homes, there is coverage in the homeowners or renters insurance policy for living expenses while you were displaced. In that coverage, there is a whole list of eligible expenses that you don’t know about and it’s not listed in the policy. The insurance companies will likely not tell you this, but I’ll tell you.
2. How will you reconstruct your inventory of personal property? I’ll show you how.
3. The insurance company will depreciate your dwelling and personal property, even if you have replacement cost coverage. Let me tell you how to beat this process.
4. Are you underinsured? If you don’t FIGHT THIS PROCESS, the insurance company will determine how much your dwelling is worth, and if you have enough insurance. If THEY say you’re underinsured, they’ll hit you with a penalty. I can show you how to fight and get the correct valuation on your property.

Watch for my next four articles. In them, I'll expand on each one of the four points listed above. In addition, read each of the articles about the Top Ten List.

You can win the insurance game when you have the right tools!!

"Notify The Insurance Company." Seems sort of obvious, doesn’t it? But, there are different ways to notify the company that you’ve had a loss. And when you notify the insurance company can make a big difference in how your claim is handled.

This is an excerpt from the book "Insurance Claim Secrets REVEALED!"

The first place to look for information is on your policy. Many policies will have a telephone number listed for reporting a claim. However, I’ve seen policies that require the policyholder to notify the company in writing. So, make sure that the method of reporting your claim is acceptable to the insurance company. Likely, your agent has his name and telephone number on the policy. If so, call him and report the loss also.

Sometimes, an agent will have settlement authority to handle small losses, such as homeowner’s losses under $2,000.00. In that kind of instance, the agent could handle the claim for you. I’ve found this situation to be rare, though. Occasionally, captive agents (agents that work for only one company, like State Farm or Allstate) will have a small amount of settlement authority.

The first thing you should remember is that the agent is licensed by the Department of Insurance in his state to be an agent. There is a separate license for claims adjusters. It's actually a violation of insurance regulations for an agent to do claims adjusting. It’s not his job to handle your claim, but to assist you in buying the coverage that’s right for you. Agents can be very helpful by making calls on your behalf if you’re having problems in your claim. They can be helpful in finding out key names and phone numbers for insurance company personnel that are handling your claim. If the agent has a large number of policyholders with that company, and his clientele represents a large amount of premium to that insurance company, it can be very helpful to have the agent call on your behalf when you’re having problems.

After all, it’s all about customer service, and keeping the promises made in the insurance policy.

Sometimes, the agent or an office secretary/customer service representative will fill out a claim form (called an ACORD form), and submit the claim form to the insurance company on your behalf. In this age of the Internet, frequently the claim form is electronic, and the agent will submit the electronic form by computer.

If the agent notifies the company on your behalf, and uses some type of form, ask the agent to send you a copy of the completed form. Then, you’ll be certain that the claim was submitted, and the date the claim was submitted.

Many times, however, the agent will have to refer you to the claims department of the insurance company. Your policy may have a telephone number for the claims department listed on the policy, and instructions how to make a claim.

Your policy requires you to notify the insurance company “in a timely manner” after you’ve had a claim. What is timely? It varies policy to policy. But each state has statutes of limitation that limit the amount of time after a claim occurrence that a claim can be made. Check with your state’s Department of Insurance to determine the statute of limitation where you live…or where the loss occurred. You’ll find a list of all of the Insurance Departments of all 50 U.S. states and their phone numbers in the Appendix, and at the website at: www.insurance-claim-secrets.com .

For example: you live in Minnesota, and own a retirement home in Florida. The Florida house gets hit by a hurricane. The statutes for Florida would apply.

WARNING: If you wait more than a month after your loss to notify the insurance company, they will be instantly suspicious. In those cases, you should expect to receive one of two forms from the insurance company before they begin their investigation of the loss:

Non-Waiver Agreement. This basically states that the insurance company is going to do a thorough investigation of the claim, but that their investigation does not commit them to pay the claim. It states that they do not waive any of their rights under the policy, and that the insured does not waive any of his rights by cooperating with the investigation. The insurance company wants the insured to sign this form. However, if the Insured refuses to sign the form, the insurance company will send him a….
Reservation of Rights letter. This states basically the same thing as a Non-Waiver Agreement, but the Insured does not have to sign it.

Don’t forget to write in your claim journal the date, time, who you spoke with, the phone number you called, and what was said when you reported your claim. That information could be very valuable later if you have problems with your claim.

Most likely, you’ll receive a claim number from the company when you report the loss. Write the claim number in your journal!!! Don’t expect the insurance company to quickly send you a form that has the claim number on it. Sometimes, it may be many days before the claims department sends you any correspondence, and you will likely need to speak with them before then.

WARNING: What about a situation in which someone else is at fault, and you’re making a claim against the other person’s insurance company? This could happen in an auto accident, or if someone causes damage to your house, or your contents. EVEN IN THIS SITUATION, you must notify your own insurance company that you’re involved in a claim.

The reason is that third party claims don’t always turn out well for you, the claimant. Sometimes, the other person’s insurance company denies liability or denies coverage. Sometimes, the other person’s insurance company drags the process out. Sometimes, the other person’s insurance company makes a settlement offer far below the fair value of the claim. Months may pass, and you have suffered a financial loss that is not getting paid.

What if you, or someone in your family, is injured in the claim…and the other guy’s insurance company won’t accept liability?

Those things might occur weeks or months after a loss. In many cases, you can short-cut that process and make a claim against your own insurance policy to repair the damages. Then your insurance company will do something called “Subrogation.” That is, they will pay your claim, and then contact the other person’s insurance company and demand reimbursement, including your deductible.

So, if you don’t report your claim right away, the policy might allow that insurance company to deny your claim based upon late reporting.

Besides, your policy REQUIRES you to notify the insurance company “promptly” after you have a loss of covered property. That requirement is there no matter who is at fault for the damages.

Don’t get caught in this technicality! Don’t lose your right to collect what you deserve.

Copyright 2008, by Russell Longcore. All rights reserved.