A Roadmap for Insurance Claims after a Natural Disaster

After the winds end and the waters recede, people affected by the two monster hurricanes in the southern United States will need to move fast, keep records and become their own advocates if they are to recover financially.

Many people whose property has been damaged by a flood learn quickly that standard homeowners’ policies cover structural and water damage only in limited circumstances, like when a falling tree knocks a hole in a roof or breaks a window, allowing rain to fall inside. Most policies do not cover damages that result from rising water, unless the homeowner lives in a designated flood zone and has purchased insurance through the federal government’s National Flood Insurance Program. (To make a claim through FEMA, go to https://www.fema.gov/nfip-file-your-claim.)

There are reports that up to 80 percent of those impacted by Hurricane Harvey do not have flood insurance. For those who do not have flood insurance, the government may step in with a safety net. Americans affected can check with DisasterAssistance.gov to learn the details about how to get assistance.

In the latest contribution to LetsMakeaPlan.org, CFP®Board offers guidelines to help people filing insurance claims after a natural disaster, including:

• Act fast and document everything. Those affected should take photos before moving any damaged items. Experts also recommend making claims as soon as possible, because insurance companies work on a first-come, first-served basis.
• Wait before making permanent repairs. An insurance adjustor will visit the property to survey the damage, and residents will need to agree on the value of repairs. Before making temporary repairs to prevent further damage, inform the company.
• Make sure the adjustor represents your insurer. In a widespread disaster, there will be independent insurance adjustors on the scene, which means it’s important to make sure the adjustor works for your insurer. You can also ask for the name of the internal adjustor to whom the independent adjustor is sending information.
• Remember settlement offers can be negotiated. The insurance company may not be taking into account regional differences in the costs of materials and labor, for instance.
• Keep a paperwork trail and register complaints in writing. There are places to turn for help, including state insurance commissioners.

Of course, the time to examine the details of your insurance policies is before a disaster. CFP™ professionals can help Americans ensure they are fully covered.