Patience is a Virtue When Settling a Home Insurance Claim

J.P. Gonzalez-Sirgo
Founder of J.P. Gonzalez-Sirgo, P.A.

When a property owner is navigating the process of getting a home or business structure repaired or replaced, the financial challenges posed by dealing with contractors, business interruptions and other losses can make it tempting to rush to get the process wrapped up.  If your insurance company makes a check available, the temptation to sign the check and any supporting documents can lead to a regrettable mistake. When moving through the process of settling a homeowner insurance claim, it is important to exercise caution and to carefully review all documents.  Despite the anxiousness that a homeowner or business owner might feel to wrap the process up, the exercise of patience is the best way to avoid regrettable mistakes.

Before you accept a check from your homeowner’s insurance company, you need to ensure that the amount is sufficient to cover your full cost of repair or replacement.  Before signing any release of your claim, you need to carefully review all bills incurred and carefully review your policy to ensure that you are receiving the full value of your claim.  If the contractor indicates that the cost will be more than the insurance company will cover, you should speak to the adjuster directly before work begins.  Many times, the disparities can be resolved, so you are not faced with a shortfall that will not fully pay for the cost of repairs.

Under some circumstances, the insurance check might have both your name and that of your lender if the home is subject to a mortgage.  If the check from your insurance company also bears the name of your lender, you will have to contact your lender to determine what is required to obtain your mortgage company’s endorsement.  This can be a somewhat burdensome process.  The lender may require documents like a repair affidavit, W-9 and other documents from the contractor before endorsing the check.  In certain cases, the lender might even hold the check in an escrow account until the work is completed. 

The justification for this practice is to protect the mortgage company’s security interest in the property.  If the funds are held in an escrow account, the lender might perform an inspection of the property to verify that the work has been completed.  The homeowner should make every effort to be available for home inspections because this will facilitate a faster release of the insurance proceeds.  Once the repairs have been verified, the insurance company will release the funds to pay the contractor.  Even if the work ends up costing less than the estimate, the lender must release the difference to you, the insured.

Sometimes you will need to request a supplemental home insurance check because of additional damage discovered during the initial repair work.  There can be damage hidden behind drywall or in the space between the roof and ceiling that is not visible until the repair work is underway.  The contractor should provide another estimate to submit to your insurer when requesting a check for the subsequently discovered damage.

If you have questions during any of the steps during this process, you should consult with an experienced Miami property damage insurance attorney.  If your homeowner’s insurance company denies your claim or refuses to pay the full repair or replacement value, you should seek legal advice.  I am an experienced Miami property insurance claims attorney and former claims adjuster who handles disputed claims in Miami and throughout Florida.  The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations.  No Recovery, No Lawyer Fees.  Call 305-461-1095 or Toll Free 1-866-71-CLAIM.

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