Insurance Claim: All You Need to Know and Do After a Loss
Provided by Gilbert De La Garza with DLG Insurance Group. Please visit DLG Insurance Group at www.dlginsurancegroup.com and on Facebook at www.facebook.com/DLGINSURANCEGROUP
Suffering a loss can be quite damaging but it is worse when you run into problems with your insurance provider. In order to ensure you leave very little to chance when seeking adequate compensation for your loss, here are the most important things you need to know and do.
Quick facts
- Insurers deny less about 3% of claims annually which remains unchanged from previous years*
- On a typical working day, insurers pay policy holders over $120 million on the average*
- Number of claims withdrawn by consumers and various businesses stood at 217438 claims in 14-15 year an increase of 65%*
- On the average, 6% of claims are declined by insurance providers annually*
Defining a Claim
Insurance claims ensure you are awarded a compensation for any loss that results from an incidence which is included in your insurance policy. Notifying your insurance company constitutes as a claim.
Things To Know
First Party Claim: the definition above perfectly describes a first party claim where you file a claim for loss or damages with your insurer.
Third Party Claim: this is a claim lodged with the insurance provider of another person or business for a loss or damages caused by this person or organization.
Investigating a Claim
As part of a claim process, an investigation will be conducted by the insurer to verify the authenticity of your claims. Most times you will be required to provide some form of evidence that corroborates the reported incidence. These may include but not limited to:
- Photos of the scene e.g. accident, fire outbreak, burglary and theft.
- Evidence from witnesses.
- Medical report in cases of injuries.
- Police report.
- Receipts for damaged goods or property.
Settlement or Denial
On investigating and accepting a claim, the insurance provider pays a settlement check. However, if the claim is denied for a number of reasons, you have a right to appeal the process. Also you can request for the reason your claim was denied and you can expect the policy provider (Insurer) to provide you with a copy. If the settlement is deemed to be below the value of loss you had, an appeal process can also be started to revise the value of the check.
- The policyholder reason for a claim was not given or recorded.
- The claimant decided to withdraw or not follow up on the process.
- The value of the claim falls well below the cost of pursuing it and makes it uneconomical.
- The claim was duplicated.
- The claim is not included in the insurance policy.
Calculating Your Claim
An insurance claim expert usually uses one of the formulas used by insurance companies to determine the amount to be paid for a settlement.
The expert adds your medical bills and multiply it by a factor of 1.5 to 10 depending on the severity of the injuries. Then lost wages are factored in to determine the value of the settlement. You can always negotiate for more with the insurance company on arriving at this value.
A Public Adjuster
Finally, it is advisable to employ a public adjuster to help ensure your claim is promptly attended to and an appropriate settlement is reached. This is also to help with the intricacies that come with keeping correspondence with your insurance company especially with large claims.
1) Is the company registered with the National Association of Public Insurance Adjusters?
2) Do they have errors and omissions insurance? Professional adjusters carry this insurance, which protects you in the event that the public adjuster makes an error that negatively impacts your claim.
3) Is the company licensed in your state? Check with your state insurance department, the agency responsible for licensing public adjusters in most states.
4) Do they have a Certified Public Accountant on staff to handle business interruption claims?
Click here for a list of insurance agents in Texas.
Things To Do
Safety First
In case of an incidence that results in a loss, damages or injury. It is important to ensure your safety and that of your family or people around you. Following the instructions of the police and emergency services is strongly advised. Most insurance company don’t pay for third party claims after the major incidence.
Review your PDS
Going over your Product Disclosure Statement helps to check the validity of your claim and if the incidence is included in your policy. This is optional as the insurance company will check on receiving your claim.
Contact your Policy Provider
It is advised you contact your insurance company within 24 hours of the event. Some events require only a phone call to make a claim while most need you to fill a form. You can download the form your insurer’s site or have it sent to you. It is advised to lodge a claim with your policy provider as:
- Some policies have limited times included in them.
- The insurance provider remains unaware of your loss till you report.
- Also your insurance company may not pay for any added damages due to your delay.
Evidence and Records
It is important to keep a written record of the event as soon as possible after it occurred. This help to avoid forgetting important bits. Also keeping a record of correspondence with your insurance company can prove to be helpful during the settlement process.
It’s advisable to keep a file to keep the original documents of copies given to your insurance company. You may include contact details of your witnesses, photographs relating to the event and damaged properties to support your claim.
Financial aid
You might be in need of financial aid during the settlement process and an advanced payment can be made while the insurance claim is being accessed.
This will help with your most pressing need and essentials.
It is however advised to keep your spending in check, staying with a relative instead of a hotel can help both you and the insurance company. They will reimburse your host for the calculated cost of housing you on completion of the process.
Conclusively, here are three things you should avoid while pursuing a claim:
- Do not repair anything until approved by insurance company
- Do not throw away anything including damaged items, personal property, and receipts.
- Do not assume you have to use the insurance company’s vendors; you have the right to hire experts such as, public adjusters, contractors, engineers, etc. It is usually in your best interests to do so.
