Rebuilding After Your Loss
Settlement of Your Insurance Claim
Written by Tamara Embry of Smith-Embry Insurance Associates, Inc.
Once your loss has been reported to your insurance carrier and an adjuster has assessed the damage, an evaluation of your loss will be sent to the carrier for settlement of your claim. Depending upon the number of losses in your geographical area, it may take some time before the adjuster arrives on your premises and before your claims process begins. Do not hesitate to contact your assigned claims adjuster or insurance agent for help in settling your claim or getting an update on the settlement of your claim.
When your loss has been evaluated, you should receive a letter with a copy of the documentation used in the evaluation of your claim. If the damaged structure is insured for replacement cost, you initially will receive a check for the gross loss, less your deductible and less depreciation. The letter should advise the amount of time you have to repair or rebuild the damaged structure for reimbursement of the held-back depreciation. Should the repair or rebuilding take longer than the amount of time provided, contact your assigned claims adjuster as soon as possible to ask for any extension available.
Once the repairs or replacement of the damaged structure has been completed, you must submit repair receipts, invoices, or any other form of documentation to the insurance company to make claim for the held-back depreciation.
If the damaged structure is a total loss, insured for replacement cost and you do not plan to rebuild back to size and/or scope of the original structure, your claim is settled for the gross loss, less your deductible and deprecation, and the insurance carrier will not reimburse the held-back depreciation.
If the damaged structure is insured for actual cash value, the insurance company will settle your claim for actual cash value less depreciation, and you cannot make claim to the depreciation once repairs or replacement have been completed. Actual cash value is defined as the smallest of 1) the cost to repair or replace the property with materials of like kind and quality to the extent practical or 2) the actual cash value of the property at the time of the loss with the exception of mobile homes insured for actual cash value which also include 3) the difference in the actual cash value just before the loss and the actual cash value just after the loss.
Whether you have structures requiring repair or replacement, or whether they are insured for replacement cost or actual cash value, your claims adjuster should provide you with any information requested and help in settling your claim. Although your insurance agent is not directly involved in the claims settlement process, you should feel free to contact him or her for any assistance you feel is needed.