10 Things You Should Know When Negotiating a Property Claim

Here are ten things you should know when you are negotiating a property claim:

1. Review Your Policy

   Never assume something is covered by your insurance policy simply because you expect it to be. Take some time to carefully read through your policy, especially where it was bought for you. Look out for specific clauses on your coverage and the claims process. Is there a deadline for claims? What exactly can you claim in the event of loss?

   This step is crucial because the insurance company adjuster may leave out coverage information you are expected to know. For example, homeowners’ insurance policies usually allow you to purchase coverage for additional home structures such as sheds and garages. If your property is damaged and the damage affects your garage, the insurance adjuster may conveniently not mention its repairs in your settlement. The burden is on you, the policyholder, to know your policy like the back of your hand.

   Insurance companies also often avoid mentioning the coverage for code upgrades that the property needs. This means that they do not disclose “code upgrade insurance” which is additional coverage that covers your property’s needs including plumbing, electrical work, sprinkler systems, insulation, windows, and doors that are needed to bring your property up to code. This could cost you thousands of dollars out of pocket if not brought to the insurance company for payment. 

   Reviewing your policy also helps you understand the benefits you are entitled to. For example, repairs on your home may keep you out of it for a significant period. In that case, you may be entitled to reimbursement of whatever you have spent on temporary housing or additional living expenses.

   Understanding your policy is the best way to avoid unknowingly committing insurance fraud and efficiently negotiate with the company. 

2. Know Your Rights
   

   Understanding your policy is one thing but knowing your rights is a different thing altogether. For starters, you have the right to appeal the settlement the insurance company offers you. It is a common misconception that you must accept whatever the company is offering to pay. You are well within your rights to reject it and negotiate a higher settlement if you wish.

   You also have the right to have a third party handle communications and negotiations on your behalf such as your attorney if you believe they have a better chance at upping your pay-out.

   You can hire the services of a loss adjuster or public adjuster to negotiate on your behalf. Your public adjuster will try to get you a full and fair settlement, unlike the insurance adjuster who will be working to get you the least amount possible.

   Avoid contractors or vendors recommended by the insurance company or their agents and adjusters. This is because those contractors are often also hired by the insurance company and this creates a conflict of interest. They are also part of third-party administrator programs which means they are providing some service to the insurance company as well. Their loyalties will largely lie with the insurance company, not you, and just like the insurance adjuster, they will also find ways to help the insurance company save money. For example, these contractors might recommend cleaning or fixing up construction materials damaged by soot, water, or fire rather than replacing them which would be better and safer for you. 

   Look out for what valuation you are entitled to when negotiating the settlement with the company. You may be entitled to either depreciated or replacement value. Depreciated value means you will need to provide the purchase price and date of the damaged or lost asset. Replacement value allows you to simply provide the current prices of the asset.

3. Gather Evidence
   

   It is common practice for insurance companies to request some form of evidence to support your claim when you are submitting it. For property claims, it is best to have picture evidence of the damage. Take pictures of the beginning of the damage and try to document how far it spread. Do not forget to document any items that might have gotten damaged in the process.

   You can consider hiring a professional public adjuster who will properly inspect for hidden damages like water and smoke. These types of hidden damages can be inspected through moisture mapping or hiring a smoke odor hygienist to test for smoke behind walls. 

   You should also refrain from throwing things away immediately after damage occurs. This can impact your claim negatively and reduce your negotiating power. Instead, document the situation first and allow the insurance adjuster to carry out their investigation.

   Have a notebook when gathering evidence to help you put together a list of damaged items that you should be covered under your homeowners’ insurance. This list is usually required when submitting claims for damaged personal property. A public adjuster can create this list of damaged personal property items for you.

   Gathering evidence helps you strengthen your position and will make negotiation easier for you. If your insurance company is unwilling to increase your settlement, you can show them the extent of damage, items lost, and estimates to convince them. 

4. Never Be in a Rush to Accept the First Offer

   The chances that the insurance company’s first offer is much lower than what you are entitled to are quite high. Do not be eager to accept it simply because you want the claims process to be over as soon as possible. Pause and understand what exactly you are being offered in your settlement. Are they excluding certain damages? What does that mean for you? Are they covering your additional living expenses?

   This is one of the reasons gathering evidence is so important. It will be easier for you to reject or accept an offer if you have an understanding of the damage and how much it will cost to fix. You will almost immediately know when the settlement is too low and if you understand your policy, you will know where you are entitled to more.

   The claims process can be long and winding sometimes but do not cheat yourself out of a fair settlement by accepting the first offer. Slow down a little and take your time to negotiate.

5. Hire a Public Claims Adjuster for Professional Advice

   It is always a good idea to contact a professional when you are also up against professionals. Just like the insurance company has its adjuster, you can hire a public adjuster to help you handle your claim. Having one means you have a seasoned professional to handle both the filing of your claim, negotiation, evidence gathering and valuation of both your property and the damage.

   A public adjuster can easily explain your policy to you and give you solid advice that will fetch you the best settlement you can get. This will save you time and sometimes, fast-track your claims settlement process.

   Always look out for reputable and professional public adjusters when hiring one. You can also seek recommendations from your circle; including your friends and family. This way, you can guarantee that you are hiring one that will represent your interests accurately and ensure you get value for your money. 

6. Consult Your Public Claims Adjuster Before Signing Anything

   Putting your signature on any document or agreement will legally tie you to the terms contained in it because it is assumed that you read the document and agreed to it. The nature of the document you are being asked to sign is unimportant. Always consult your adjuster beforehand as long as you are being asked to endorse a document with your signature. This will prevent you from setting yourself up for restrictions or harsh terms.

   Your adjuster is trained to recognize any shady provisions and also knows how to introduce terms beneficial to you. Do not sign with the insurance company’s preferred vendors because they are part of third-party administrator programs. Signing before consulting your public adjuster can spell trouble for you.

7. Arrange for an Inspection of the Property

   You should expect two separate inspections. The insurance adjuster will need to inspect and evaluate your property to determine how much to recommend to the company as your settlement. Make sure you have taken pictures and videos of the damage before the insurance adjuster comes to inspect your home. Furthermore, try to not move anything around at the site of the damage to not interfere with the inspection.

   After the insurance adjuster completes their inspection, arrange for your public adjuster to have a look as well. They will use special tools to discover the scope of the damage. They will also get their quote for repairs which will enable them to come to an estimate. It is with this knowledge that they negotiate with the company and get you a fair settlement that will be sufficient to cover the damage.

8. Get Police Reports Where Necessary

   Some policies require you to get a police report before you can file certain claims. For example, if you are claiming loss or theft of personal property, you may need to file a police report for those items before submitting the report with your claim. Furthermore, if the damage to your property was caused by a break-in or vandalization, you will need a police report.

   Try to get the report as soon as possible so you do not delay your claim. This will also ensure that the insurance company starts processing your claim quickly and you get your settlement faster. Remember, the longer the damage is left unrepaired, the worse it becomes. 

   You can get a police report by filling out a Freedom of Information Act Form and submitting it to your local police station. You should expect them to send the police report within a few business days after your submission. You can use Rocket Lawyer to generate a sample form.

9. Put All Requests and Agreements in Writing

   Do not rely on oral agreements or discussions. They can be difficult to prove if one party decides to go against it. It is a better idea to put your discussions in a written format that is signed and agreed upon by each party. This protects you in the case of default.

   This should apply to both your adjuster and the insurance adjuster. Do not assume that your public adjuster will not go back on their promise simply because they are working for you. If they offer you a deal on payment, ask them to put it in writing. The same goes for if they offer you extra services at zero or reduced cost.

   You can try recording any oral conversations you have with the insurance and public adjuster if you cannot remember to always ask them to put it in writing. If your requests or agreements are in the form of letters, make copies of them and store the originals in a safe place. This way, you can always pull them out as evidence. If they are by email exchange, try to organize the emails in a folder so they are always easy to pull up when you need them. 

10. Check Your Policy for the Dispute Resolution Process

    You can find the dispute resolution process in the appraisal clause in the insurance policy. All insurance policies allow for the act of appraisal which means that the insurer will conduct an appraisal of the damage or loss and the insured is also at liberty to perform an appraisal. This appraisal by the insurer will be done by a third party who will then provide the insurer with their expert opinion. If a dispute arises between you and your insurer, a neutral umpire is elected to mediate between both of you and conclude any disputes.