Feb 02, 2024Protecting Your Property: The Importance of Insuring to Value and Building Ordinance or Law Coverages
Learn about protecting your property and the importance of insuring to value and building ordinance or law coverages.
Understand property claims, the repair process, and how to handle the aftermath. Here’s what our experts at M&G say.
If you’ve faced a property claim, the final step of the process is to start planning the repairs. The size and complexity of your claim will affect what happens next.
Claims and repairs can be a stressful and overwhelming experience. It’s important to understand the steps involved in the repair process and how to handle the aftermath. Our experts at M&G are here to help you know what to expect, how to find the right contractor, insurance coverage and compensation, policy limitations, and the importance of documentation. Whether it’s a minor or major claim, our team is here to provide you with the knowledge needed to protect what matters most.
If the damage is relatively minor, the adjuster may ask you to send pictures of the damage, and then write a repair estimate based on those. In some cases, the damage restoration contractor who performed the initial mitigation work might be retained to write the estimate. For more serious claims, the company can elect to send out a field adjuster to inspect the damage and write an estimate for the repair.
When you’re ready to begin repairs, it’s a good idea to start looking for a contractor in your local area, if you haven’t done so already. While many repairs can be performed by reputable damage restoration contractors, other types of licensed contractors might be better suited for your situation. Be sure to pick your contractor wisely; the company might not continue to pay for business income loss (or loss of use) if there are delays in the completion of repairs.
After the estimate is complete, you’ll be paid for the actual cash value of the repairs, which may be less than replacement cost due to depreciation. In many cases, however, that first check won’t necessarily be the final payment. For example, if your contractor finds additional damages while performing the repairs, he/she can file a request for a supplemental payment. And, of course, if you’ve purchased replacement cost coverage, the company will issue payment for the recoverable depreciation once you submit final invoices to prove the repairs were completed.
If you have a loan on the property, the mortgagee/lender may be listed as a payee on the insurance check. Sometimes, for larger claims, the mortgagee will hold your claims payment in escrow and release the funds to you in installments as you’re able to demonstrate the progress of repairs.
It’s important to remember that your claims payment is only intended to bring your property back to pre-loss condition; in other words, your policy isn’t going to pay for any upgrades or remodeling that you decide to undertake along with the repairs. Also, if your claim triggers requirements that you update your building to comply with current building codes or ordinances, those updates won’t be covered unless your policy includes that optional coverage.
Perhaps most importantly, even though it’s been said before: document, document, document! Keep all your receipts for consideration under the policy, even if you’re not sure the expense will be covered – after all, it never hurts to ask!
With so many details to keep in mind, even small claims can be challenging. No matter the size of your claim, remember our team at M&G is here to help. Please give our office a call at any time if you ever need assistance.