Welcome to the ABCs of Insurance Claims. Over the next few months, Sherri Walker, Sentinel’s Director of Claims will address an aspect of claims handling for every letter of the alphabet to help provide a better understanding of the claims process.
Most claims require a sense of urgency to some extent, but there is one claim type that always “lights a fire” for adjusters. It’s the kind of claim that everyone hopes they never experience as it has the potential to be one of the most tragic – a fire claim. Even a small fire has the potential to do extreme damage and displace homeowners or businesses for an extended period of time.
Important Steps To Follow
There are several important steps to follow if you are the victim of a fire loss. After the fire is extinguished and the fire department has packed up their gear, promptly reporting the claim to your broker and/or carrier is of utmost importance.
Many carriers have 24-hour reporting, along with on-call or claim escalation teams that can assist with getting you into temporary accommodations day or night. In addition, there are certain aspects of the claim the adjuster will want to view with their own eyes before the scene is further disturbed to put the claim into motion. The sooner they are alerted the better.
Once the claim is reported and assigned, your adjuster will likely secure statements from all parties who were present at the time of the fire. They may also involve a Cause and Origin Engineer to determine the proximate cause of the fire and retain an attorney to assist in pursuing any third parties that could be responsible for the fire – i.e., manufacturer of a faulty toaster, or an electrician who failed to properly install wiring.
Once the investigative aspects of a claim are complete, there are many items to consider while estimating and potential payment of the claim. Often, fire will cause damage to structural components, and may require a civil engineer to approve specific repairs for safety purposes, for example trusses in the roofing structure. Since these are engineered components, they cannot be repaired without an engineer’s inspection and approval.
Many times, after a large loss, adjusters will hire a building consultant to assist in completing the estimate and reaching agreed costs with your contractors for the restoration portion of the job. This can be a large scope of loss as there may be secondary damages from the process of extinguishing the fire, such as broken windows or doors for access, and significant water damage.
Even if areas of the home are not impacted by the actual fire, there will be smoke and odor damage that must be addressed. Additionally, fire is one of the few occurrences for which trees and shrubs are covered for damage, and a landscaper may be used to help determine the replacement costs of these items.
In addition to the actual structure, Contents or Personal Property constitute a large component of a fire loss as well. While there are damaged items that may be obvious, there are often items that may not be visibly damaged by fire that will need to be cleaned or replaced.
For instance, canned food and spices should not be used after a kitchen fire, and clothes in closets as well as bedding, linens and other fabric items in non-fire damaged areas may need to go to a specialized vendors for cleaning to remove residual particles and odors. There are contents that you may not think of when making an initial inventory of damaged goods – everything down to light bulbs and toilet paper.
Due to the extensive amount and variety of the items typically involved, your adjuster may offer to retain a specialist to assist in creating and valuing an inventory of damaged contents on your behalf.
Temporary Living & Working Accommodations
One of the more potentially stressful aspects of a large fire is finding a place to live or work until the restoration of the property is completed. Many policies have a coverage in place that will cover rent on temporary accommodations, as well as increased expenses that you incur due to being displaced.
These coverages can address increased utility bills that continue even while out of your home or business premise, and some policies even provide mortgage assistance that will cover the cost of your primary mortgage while you are unable to utilize the premise accordingly. Homeowner policies can also aid in an increase in food costs or pet boarding if you must be in a hotel temporarily before residential accommodations can be made.
For businesses that suffer a fire loss, there is potentially coverage for rental of temporary office space or renting a warehouse for the time that they are unable to use their own storage locations.
Proof Of Loss
Like everything in life, a large claim comes with a bevy of paperwork. If your adjuster provides you with a payment advance to provide you funds immediately for clothing, food, and necessities you have lost, they will secure a receipt for those funds, which will be subtracted against future payments for those items.
There will be a form known as a Proof of Loss that will be provided initially and then finalized towards the end of the claim. There may be various estimates and inventories provided to you along the way that are important to retain, and you may have paperwork from the city or state regarding permitting for the restorations required. The fees associated with those permits are typically covered under your policy, and you will want to make sure that the information regarding those fees is submitted to your adjuster.
Sentinel's Claims Team
We hope you never have to experience a fire loss, but if you do, rest assured that the claims team at Sentinel will be with you every step of the way.
If you want to like to make sure that you have adequate coverage for a fire or other large loss, our dedicated team of specialists are here to for advice, guidance, and consultation to Safeguard your Success and protect the things that matter most.