Understanding the Insurance Claims Payment Process

After a disaster, you want to get back to normal as soon as possible. When your home has been damaged and personal possessions are lost, your home insurance in Red Hook, NY can help you get back on your feet. In addition to understanding how to file a home insurance claim, it’s important to understand how the claim payment process works. You may get multiple checks from your insurer as you make temporary repairs to minimize damage, permanent repairs, and replace damaged belongings.

The initial payment isn’t final.

Typically, an adjuster will be sent to your home to inspect the damage and offer you a certain amount of money for repairs based on the terms and limits of your homeowners insurance policy. The first check that you receive from your insurer is often an advance against the total settlement amount, not the final payment. If you are offered an on-the-spot settlement, you may accept the check right away.

You may receive multiple checks

Generally, when your home and personal belongings are damaged, you will receive two separate checks from your insurer. If your home is uninhabitable after the disaster, you can also receive a check for the additional living expenses (ALE) that result from staying away from home. If you have flood insurance and experience flood damage, that means a separate check as well.

The contractor may be paid directly

Keep in mind that you may not always receive the money from the insurer to repair your home – it may go straight to the contractor. Some contractors may ask you to sign a “direction to pay” document that allows the insurer to pay the company directly. This is a legal form so be sure to read it through carefully and call your insurer if you are uncertain. When the work is completed to restore your property, make certain the job has been completed to your satisfaction before the insurer completes payment to the contractor.

When you’re looking for homeowners insurance, contact your insurance professionals at Kneller Agency. Our dedicated experts are ready to assist you with all your home insurance needs.

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