Things to Consider When Filing an Insurance Claim

3/1/2019 (Permalink)

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I had the opportunity to speak with one of our clients this past week and during our conversation we dove into the issues of when to file an insurance claim and when to consider paying out of pocket. 

There are unfortunately many communities that struggle with water issues for any number of reasons.  Poor drainage, built on former wetland, improper development, etc. Due to the frequent losses some homeowners use their insurance as they believe they should. The problem that arises due to frequent claims is the fact that many insurance companies begin to view that homeowner as a high risk client, the job of an insurance company is to manage risk for not only the homeowner but also for themselves. Insurance is an investment for not only the insurance company but also for the homeowner. 

When the insurance company starts to see the risk level rise on the part of the homeowner, their investment in carrying the homeowners policy becomes less appealing and therefore some homeowners will be dropped by their provider.  When the homeowner goes to find new insurance they will find that their claim history is unfavorable and they will end up paying higher premiums. 

As a homeowner, you have ways to manage your risk as well and that begins with the decision on what to do in the event of a water loss.  Many homeowners have heard that bringing in a restoration company can be expensive, in order to understand cost the homeowner must first see value.  The value of using a restoration company can be the difference between a total basement renovation and a matter of a few days of drying and slight reconstruction. 

The average loss will run between $3000-$5000 depending on how severe it is and what is rolled in after the drying has been done. It may seem easier to do the job yourself but the thing you need to keep in mind is that the standard dehumidifier that you purchase in store is not designed to dry behind drywall and in sill plates like more restoration companies equipment does.  What this means for you, the homeowner, is that your home is dried out and treated properly rather than increasing your risk for mold and other bacteria that may linger after a water loss. In addition to mold and bacteria issues, wet materials can lead to structural issues down the road as well, so that $3000 restoration bill now becomes a $20,000 reconstruction bill which will not be covered by insurance. 

When it comes to insurance and water loss, you determine if the loss is significant enough to call in a restoration company and put your long-term financial security at risk. 

For questions call our team at SERVPRO of Spencer & Iowa Great Lakes at 712-262-4379.