Homeowners Insurance Claim Settlement Process Guide

Homeowners insurance claim settlement process

As many of you know, the process of submitting a homeowners insurance claim can be a difficult and winding road. That’s why getting that settlement check from your insurance company feels so good! Not only are you about to get your life back on track, but you also are done with that exhausting process.

Or are you?

Many people don’t know that getting your settlement isn’t the last step of the process every time. Many people end up with even more questions than they had before. Why isn’t my settlement as high as I thought it was going to be? Why did I get 3 checks? Why did I not get a check at all?

We hear all of these important questions all the time and we hope to be able to answer them for you here!

You may receive multiple payments

It is very common for you to see multiple checks in the mail when you get your insurance settlement. Why is this? It is because many larger claims actually impact multiple different areas of your policy. One individual claim might hit your homeowners insurance, property insurance, car insurance, and sometimes even more. Insurance companies want to categorize these payments to keep track of them, which means you may receive multiple different checks for different amounts. Just be sure to total them all up to be sure you received your entire settlement payment.

Your insurance company may pay your contractor directly

Depending on the situation, your homeowners insurance company might end up paying your contractor directly. This is usually done on the contractor side of things and is done to avoid having you be a middle-man between the contractor and the insurance company.

This can be nice for you since you don’t have to deal with your insurance company either. However, a word of warning. Once the project is done and the contractor is paid by the insurance company, there is no going back.

If you find that the repair wasn’t completed to your satisfaction later, you may have to pay out of pocket. Just be sure to be educated on the repairs and that they are 100% perfect before giving your final sign-off.

To get replacement value for your items, you must actually replace them

That’s right… you can’t just take that nice big check and do whatever you want with it! You need to actually use that money to replace what was lost.

This is especially true when property is lost from some major kind of event like a fire or flooding. You can’t take the money you receive from that settlement and run off to Vegas! If you lost a couch, you must use that money for a new couch. Destroyed TV? You must use it towards it.

Most insurance companies will even ask you for receipts (so keep those!) Failure to do this is a violation of your insurance policy and could leave you with a lawsuit from your insurance company asking for their money back.

What to do when your home is being repaired?

Unfortunately, not everyone has the ability to stay with friends or family while their home is being repaired. If you find yourself in this situation, make sure that the insurance company is helping to cover the costs of a rental or hotel. Most policies do include this but many people either don’t know it or forget to ask about it.

The initial settlement/payment isn’t final

What many people don’t know is that receiving your settlement or payment is not the last part of the process. Once you have received your settlement payment, there is still time for you to go back and talk to your insurance company if an error is detected or you realize that a mistake has been made. Once you receive your settlement, make sure you go back and review everything. If you see something wrong or feel as if you received too small of a payment, reach out to a public adjuster that can help you restart the process.

Have more questions about your insurance settlement? We’d love to help!

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