Insurance Claim Tips for Filing a Property or Auto Claim

January 30, 2009

Filing a homeowner or auto insurance claim can be a frustrating experience. Many times you may not get the maximum amount you should for a claim because you’re scared, complacent, or confused about the filing process. 

Today I’ll share with you some of what I learned as a former claims adjuster.  The first piece of advice, if you cannot afford to cover the expense for repairs is to go ahead and file the claim regardless of any other factors.  Don’t worry about how it will affect your premium or status with the company. 

Insurance companies are in the business to pay claims.  Of course, don’t go overboard and file every little claim possible; if the claim is determined to be less than deductible,  you’ve wasted your time and the time of the insurance company. 

Your agent might tell you to report any and all damage, but the dirty little secret is that they don’t want you to report anything.  They have to spend a lot of money to process and adjust a claim.  So to help you properly file a claim and get what the money you deserve, I’ve put together seven tips on ways you can maximize your insurance claim.

The Principle of Indemnity

Before I give you the tips, I will explain the principle of indemnity.  The biggest issue with insurance companies and their customers is that customers often feel they did not receive enough money to cover repairs for their home or automobile.  As a former claims adjuster, I can tell you with confidence that insurance companies put a lot of pressure on their claims adjuster to pay the bare minimum on a claim that satisfies the customer. 

The principle of indemnity states that an insurance company is required to pay you no more and no less than you deserve.  An adjuster’s job is to put your home or auto back in the same situation it was before the loss.  Understand that if you try to get more money than you’re actually due from a claim, then you’re behaving no differently than the claims adjuster who tries to squeak by with the bare minimum payment to you.  

Insurance Claim Tips

1) Keep excellent records.  Keep all receipts of big ticket items in your home and accessories you installed in your car.  If you have a theft or damaged personal property from a lightning strike, flood, or fire, adjusters will ask for something to justify the price you paid for the item or in the case of a theft, proof of ownership.

2) Get multiple quotes from contractors or body shops.  For a homeowner’s claim, make sure you get multiple estimates from three or four contractors.  The adjuster will create his or her own estimate for the damages.  If you do not agree with their price or scope of work, get multiple quotes to justify your disagreement with the adjuster’s quote. 

This is tougher to do if your car does not run, but sometimes you can get a mechanic that knows you to travel to the car and provide a quote.  They will often pay for towing it to their shop if they know you will use them to get the work done.

3) Be cautious of litigation. Only involve an attorney if the claim is worth over $25,000 and you have exhausted all efforts to work with the claims adjuster to come to a settlement.  If you and the adjuster disagree about something, don’t jump the gun and call your attorney.  Attorneys cost a lot of money, and they’ll take a third of your claims settlement if you get one.

Attorneys cannot wave their magic wand and get you more money.  If the issue is based on price or scope of work, you can usually work out these differences without the use of an attorney.  If the issue is over whether something is covered, then involve an attorney if the claim involves significant damage.  If it’s an auto claim involving severe bodily injury, definitely consult an attorney.  Whip lash is not a severe bodily injury! 

Remember, the burden of proof is on the insurance company.  If there are any disputes over coverage, they must prove why it’s NOT covered.  You are not obligated to prove why it IS covered.  This does not apply for all policy forms, but the most common homeowners and auto policy forms used shift the burden of proof to the insurance company.

4. Do your research and homework about the claim.  Have an idea about how much labor and materials should cost.  Some adjusters will try to intimidate you, but their tactics won’t work if you are educated and informed. 

5. Be diligent with an open claim.  Be persistent and stay on top of it.  Be involved and don’t let the insurance company call the shots.  You are the customer, and they are in business to serve you.  If you are not proactive with your claim, the adjuster will hardly ever contact you, and they’ll send you a check in the mail hoping you accept it without disputing the amount. 

 6. Never sign a release of liability form until the claim has been completely settled.  Some insurance companies try to slip this in, and if you sign it, you are agreeing that the insurance company has no more obligations or liabilities toward your claim.  In other words, they won’t pay a supplement to the claim anymore. 

 7. Don’t pay for a public adjuster.  These are adjusters that represent the customer for their open claim.  These guys are a waste of money since they can’t argue coverage disputes; they are only allowed to disputed pricing and scope. 

In my opinion many of them are crooks, and they deliberately try to inflate the amount of the claim to cover their commission they charge to handle your claim.  The increased use of public adjusters for personal claims has contributed to the rising costs of insurance premiums in homeowners and auto claims.

If you have any other questions regarding insurance claims, feel free to Contact Me


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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3 Responses to Insurance Claim Tips for Filing a Property or Auto Claim

  • Jesse

    My wife and I contacted our insurance company a few months ago because we had a hail storm in our area. Before our adjuster met with us contractors were knocking on our door constantly. They kept saying that if we filed a claim that it was against the law for our insurance company to raise our rates because this event was called an act of God, some said it was a catastrophe. Is this true? Our adjuster showed up and agreed that our roof needed to be replaced. The company sent us a check and I called a contractor to give me a bid. He said the insurance company didn’t pay enough to have the job done right, and kept talking about exactamate that he claims says that I wasn’t paid enough. He said he could do the work for me and bill the insurance company, he also said he could waive my deductible. I signed an agreement that said if he were able to get my maximum claim from my insurance company that he got to do the work. I haven’t seen him since and now I can’t even reach him by phone. He has disappeared off the face of the earth with the contract. Can I just get someone else to do the work? If he shows back up do I have to let him do the work? If he can’t get the insurance company to agree with what he claims is a reasonable price do I have to pay the difference? Since this has happened I called three other contractors who all said they could do the job for less than my settlement but after I told them that I had already signed a contract that I want to get out of they say they won’t help me until I can straighten it out with the guy who disappeared off the face of the earth. What can I do?


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