Mapping The Insurance Maze

A loss has occurred at your home. You’ve filed a claim, and you’re waiting for your adjuster to be assigned, and have no clue what’s next or what the coverages do. In today’s article, I will walk through what a Claims process may look like.

Each carrier has their own process, so it’s important to follow the instructions of your Claims Adjuster.

Once a claim is filed, a handling adjuster is assigned. They will reach out with you, and should walk you through the claims process. This should include a review of your coverages are, any limits, conditions, deductible and applicable exclusions, and next steps.

If you have your policy, let’s pull it out. I want to incrementally go through some of the basic information of your policy, starting with the Insuring Agreement, the first four coverages of the Homeowners (HO3) policy, and deductible.

All policies will start with what’s called the Insuring Agreement. This will tell you how coverage is triggered. You may see something like, “Your policy covers for “Sudden Accidental Direct Physical Loss or Direct Physical Loss, due to a covered peril.” This means that for coverage to trigger, it must be sudden (couldn’t have been happening over a period of time) Accidental (can’t have been intentionally caused) direct (you can point to the damage and see it) and it has caused a loss (can’t be something you think will happen).

Next, are the next four coverages Coverage A, B, C, and D.

Coverage A is known as Structural Coverage. This coverage pays for items that are apart of your structure. This includes your: drywall, flooring, paneling, roofs, shingles, trusses, etc.

Coverage B is known as your Dwelling Extension Coverage. This coverage is for things that are an extension of the home, and typically connected by a fence, or shared wall. This can be things like a detached garage, fence, she/he shed, driveways, etc.

Coverage C is your Personal Property. This is your shoes, clothes, wallets, purses, cleaning materials, furniture, electronics etc. Fun fact about your Coverage C is, your Personal Property is covered anywhere in the world.

***The Example that I taught my employees and family are imagine you take your home. Turn it upside down, and shake. Everything that falls out is Coverage C, and everything that stayed in the home is Coverage A. ***

Coverage D is called Additional Living Expense Coverage, or ALE. ALE reimbursement coverage for additional expenses, you as the policy owner incur due to being out of the home.

HOOOOOWWWWWEVVVERRRR – I’m sure my colleagues all across the industry would hunt me down if I didn’t give you the conditions.

There are things ALE DOES NOT PAY FOR.

• YOU missing work – that’s not covered.
• You feeling inconvenienced – that’s not covered.
• You having to take time out the day to deal with the claim – that’s not covered.

And this is just a minor list.
ALE covers things like, having to rent a hotel room or temporary home, because you are displaced. If you don’t have a kitchen, and have increased out of pocket costs for eating out more. Your Adjuster will give you the specifics of what your policy covers, and I am going to refer you back to your Adjuster to confirm, how your policy coverage triggers.

The Adjuster/Examiner should notify you of your deductible. You can also find this on your Declarations page. Your deductible is YOUR portion of the loss, that you’d be responsible for.

As with any of this information, please confirm with your specific policy, and your specific carrier.

I am going to split up discussion of the Homeowners policy, because it can be quite lengthy. There are plenty exclusions, conditions, additional coverages etc. so for now, take what you’ve learned today. Provide feedback and comments, and I’ll see you on the next one.

~ Til Next Time!