Property Damage & Vandalism Claims

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First Steps: Guide to Vandalism Claims

  • Obtain Your Policy
    • Get a copy of all of your policies. Many people often assume the “declarations page” which lists the policy limits is their policy. It is not. And you may have more that one applicable policy. Contact your broker, agent, or salesperson, and request that they immediately email you a copy of all of your policies.
  • Do Not Rely on the Broker/Agent for Coverage Evaluation
    • Do not rely on coverage opinions from your broker or agent. Insurance brokers or agents will often automatically tell you that your losses are not covered. They are the insurance company’s “first line of defense” against you. Do not rely on what they tell you.
  • Maintain Records
    • Maintain records of your losses and expenses. Make sure you maintain accurate records of your losses, operations, schedule, payroll, and expenses you’ve incurred before and after the start of this crisis.
  • Document All Communication
    • Document your communications with the insurance company. If you have already be in touch with your insurance company, but sure you keep a log of your communications with them.
  • Focus on Your Business
    • Focus on your operation. Do whatever you can to ensure continued operation of your business.

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Helpful Tips: Property Damage Claims

  1. First Claims Receive First Money.
    • It is important to get your claim submitted quickly. Most claimants do not believe that is possible because of the many unknowns related to recovering.  What is known are the provisions of the insurance policy and the claims process.
    • Most business interruptions claims are composed of two distinct components: Lost profits and extra expense. Such claims are also based on the length of the restoration period which is typically defined by the length of the repair and rebuild, as well as, the time to get back to normal.  Typically, the insurance policy will pay a benefit for lost profits for a year from the date of loss, sometimes two years.
  2. Ask for An Advance Payment.
    • In the initial period of time after a disaster the insurance industry will want to seem as if it is assisting with the recovery. After you submit your claim it is important to ask for an advance payment.  Often the insurer will provide the advance to assist and mitigate the continuing loss of profit.  The most common error I see policyholders make is waiting for the insurer to take café of them.  The insurance claims process is a data driven process.  Insurers are required to pay what they know is owed.  In Claims Handling parlance this is referred to the “undisputed amount”.  The difficulty is getting them to admit they owe anything.  By submitting a claim, you provide them with the information to make that determination and upon which you can base a request for an advance payment.
  3. Do Not Wait for The Insurance Company to Make A Decision.
    • Under every policy there are certain post loss duties the policyholder is required to perform. The first is notice.  Give notice of loss immediately.  Often the insurance broker or agent will try to talk you out of it.  Often, they are financially motivated to do so.  If your loss is significant insist the notice of claim is made to the insurance company.  Once notice is given, demand a date and time for an inspection by an adjuster.  Ask for the name and contact information of the adjuster so you can make your own arrangements.  You must push the process.  the amount of loss and damage often increases while the policyholder waits for the insurer to inspect and make a decision.  You are required to mitigate your damages.  That means you must take steps to protect from further damage.  Often that means commencing clean up and emergency repairs immediately.  To avoid issues with the insurer you must communicate with them about your intentions, give them a reasonable time to respond and then go ahead.  If you communicate and create a written record you will be protected down the line.
  4. Be Aware of All the Potential Benefits Under Your Insurance Policy.
    • Business Interruption insurance is often available through overlapping primary and additional coverages under most policies today. In some cases, you do not need direct physical loss to your property for coverage to apply if your losses are due to interruptions of business to your vendors or companies in your supply chain.  This is called contingent business interruption coverage and is often a somewhat hidden additional coverage added through an endorsement.  Also, coverage for business losses may overlap through different parts of your policy which each apply.  For instance, you will often see coverage under the Property coverage and again under the Equipment Breakdown coverage, as well as, various Cyber coverages.  Though the insurers try to maintain that the coverages apply to different and distinct perils and losses, in a disaster all coverages are often triggered and apply.  Most adjusters whether in the field or in the office are not provided an actual copy of your insurance policy.  At best, they have a summary.  The fact is that the insurer’s interpretation of how your policy applies is not reliable.  Similarly, your agent or broker may not be the best source for an opinion of what is covered.  They are not often called on to apply the policy sold to the particular facts of your claim.  During a disaster everyone involved in the process is overwhelmed and moving too fast.
  5. Hire an Expert.
    • Handling your own insurance claim is like trying to handle your own surgery. The language of insurance claims and process are foreign to most.  Though your policy is written in English the words are terms of art and have special meaning not defined in your policy.  Insurance adjusters speak their own claims language.  I have seen many claims stalled or denied simply because the policyholder did not understand what was required and what was being asked of them.