How a property claim works

The seven steps

Every policy and every loss is different, but most property claims move through these stages in this order.

1. I

   Step 1: The loss

   Wind, hail, fire, a burst pipe: something happens. Make sure everyone is safe first.

   Then, if you can do it safely, take reasonable steps to stop the damage from getting worse: cover an opening, shut off the water, move belongings out of the way. Most policies expect this, and many pay for reasonable emergency measures. Keep every receipt.

2. II

   Step 2: Notice to the insurer

   Tell your insurance company about the loss promptly. Most policies require prompt notice, and some set a time limit. You can usually report a claim by phone, online or through your agent.

   Write down the claim number, and the name and contact details of everyone you speak with.

3. III

   Step 3: A record of the damage

   Before cleanup or repairs, photograph and video the damage where it is safe to do so, room by room and outside. Make a list of damaged belongings with their approximate age and what they cost.

   If you can, keep damaged items until the insurer has had a chance to see them, unless they are a health or safety hazard. If something has to go, photograph it well first.

4. IV

   Step 4: The insurer’s investigation

   The insurer assigns an adjuster to look into the loss. That adjuster works for the insurance company. They may inspect the property, ask for records and receipts, and in some cases ask for a recorded statement or a sworn proof of loss.

   You can ask for any request in writing, and you can ask what each document is for. Keep copies of everything you send.

5. V

   Step 5: The decision

   The insurer accepts the claim, accepts part of it, or denies it. Ask for the decision, and the reasons for it, in writing.

   Compare the decision with your policy: which coverage applies, the limits, the deductible, and any exclusion the insurer relies on.

6. VI

   Step 6: Payment and repairs

   Payments can arrive in stages. On many replacement-cost policies, the insurer first pays the actual cash value, then pays the withheld depreciation after the repair or replacement is done, often within a time limit the policy sets.

   If you have a mortgage, the lender is often named on the check.

7. VII

   Step 7: If you disagree

   A decision you disagree with is not necessarily the end. See If you disagree below for the usual options.

Reading your policy

A homeowner’s policy is a contract, and it is usually built from the same six parts. Reading them in this order makes the rest easier.

Words you will meet

Deductible

The part of a covered loss you pay before the insurance pays. Some policies have a separate deductible for wind or hail, sometimes set as a share of the dwelling limit.

Limit

The most the policy will pay for a type of coverage, shown on the declarations page.

Replacement cost value

What it would cost today to repair or replace the damaged property with material of like kind and quality.

Actual cash value

Usually replacement cost minus depreciation. How your policy defines it matters, so read that definition.

Recoverable depreciation

On many replacement-cost policies, the depreciation held back at first, paid once the repair or replacement is complete.

Additional living expense

Also called loss of use. Pays the extra cost of living elsewhere while the home cannot be lived in, up to the limit.

Exclusion

A cause or type of damage the policy does not cover.

Proof of loss

A sworn statement of what you are claiming. Some policies require one, sometimes by a deadline.

Appraisal

A process in many property policies for settling a disagreement about the amount of a loss, not about whether it is covered. Each side picks an appraiser, and an umpire resolves what they cannot agree on.

Mitigation

The reasonable steps you take after a loss to protect the property from further damage.

Keep a claim file

A simple folder, paper or digital, saves hours later. Put these in it:

• The claim number, and the name, phone and email of each adjuster you deal with.
• A dated note of every call, followed by a short email that confirms what was said.
• Copies of every letter, email and estimate, from you and from the insurer.
• Your photos and videos, with the date each one was taken.
• Receipts for emergency repairs and for extra living costs.
• A complete copy of your policy, with every endorsement.

If you disagree

If you think a decision is wrong, these are the usual options. They are not exclusive, and you can talk to an attorney at any point.

1. Ask the insurer to explain the decision in writing and to point to the policy language it relied on.
2. Read that language yourself, together with the declarations page, the definitions and the endorsements.
3. Check whether your policy has an appraisal provision, if the disagreement is about the amount.
4. Contact the Nevada Division of Insurance. Its Consumer Services section takes questions and complaints from policyholders, and you can file a complaint online (government website).
5. Talk to an attorney, or to a licensed public adjuster. You can check any adjuster’s license yourself; see how to verify a license.

Deadlines

Policies set deadlines, for example for notice, for a proof of loss and for bringing a lawsuit against the insurer, and the law sets some too. Look for them in your policy’s conditions section. If a deadline is close or unclear, ask an attorney before it passes.