An Insurance question
Ted McLaughlin
A friend of mine lost his house to a fire a few weeks ago because of some electrical problem. The house was pretty much completely burned so he lost everthing. Luckily the family was visiting relatives when it happened so no injuries and they still had some clothes to wear :-).
Now the problem comes with dealing with the insurance company. They want a "Proof of Loss" statement detailing: what was lost, how old it was, cost of the item, and the cash value of the item. For everthing in the house he has to come up with this. I got the feeling that the insurance company wanted reciepts for everything that he was claiming which was a joke because any reciepts he had would have gone up in flames.
So I wanted to ask this group what has been your experience with dealing with situations like this. Can insurance companies refuse to pay for all the items you claim, like say 50 CDs at $10 apeice if you can't name all of them, let alone come up with a reciept for each one? I was just looking around the house trying to imagine remembering all of the things I had if it happened to me, it scared me to try and imagine how difficult that would be. Little things like all of my computer games, which are around $45 apiece, could I name all of them that are crowding my shelves? Let alone the suits which are like $250, jeans at $20 and so on.
Anyway, he is thinking about getting a lawyer because he is having so many problems with them. One of the guys at work mentioned something about a "Fair Reporting Act" or something like that that he should look into. The guy couldn't remember what it was for so I thought that I would toss that out too. Does it apply in this case, and if so, what is it? We live in Minnesota so if anyone has any knowledge of specific laws that apply in Minnesota I would appreciate hearing from you.
Thanks for all your help;
Feeling sorry for a Friend
P.S. I decided not to name the insurance company until all of this is settled. If it is settled badly I will gladly roast them in this newsgroup.
Luckymom
insurance commission. They tend to make insurance companies pay attention to
the claim & try to solve the "problem" with the customer a bit quicker. The
insurance commission can work wonders- in fact try just mentioning that your
going to call them & that MAY work.
--
Luckymom
Jim & Laura Behning
>
>Now the problem comes with dealing with the insurance company. They =
>want a "Proof of Loss" statement detailing: what was lost, how old it =
>was, cost of the item, and the cash value of the item. For everthing in =
>the house he has to come up with this. I got the feeling that the =
>insurance company wanted reciepts for everything that he was claiming =
>which was a joke because any reciepts he had would have gone up in =
>flames.
>
While not an answer for the current situation, some people recommend a
videotape survey of your house to supplement your itemized inventory
that you store off site. I know of this idea but have not done it
myself. Wishful unpreparedness on my part.
Jim
Laura Behning
morgans at mindspring dot com
http://www.mindspring.com/~morgans/Laura.htm
Avreco
insured. They know the ins and outs of the policy and law. They usually work
on commission and your friends will come out ahead in the long run.
Jim
Terry Kennedy
> As for your friend, it doesn't seem fair, but put yourself in the shoes
> of the insurance company. Without requiring some sort of proof, can you
> imagine how many people add things to their list that they didn't really
> have? I think the company will probably work out a reasonable settlement
> with your friend in the event he has no receipts, but it may come down
> to compromise. The worst thing he could do would be to create animosity
> (Until it's the last resort).
A lot depends on the insurance company and the way the policy was written.
I bought my house for $70K and it was assessed (for taxes) at $149K. The in-
surance company initially wrote the policy for $149K and then sent someone
out to look at the house (after closing) and they sent me a letter saying
they wanted to insure it at $290K. I could either pay the increased premium
or they would de-rate any claims by about 50% (149/290). I complained but
knuckled under. Now, this is just for the house and "normal contents" -
clothing, furniture, average home electronics, and so forth.
For additional valuables, I had to have an additional rider added, and
list any single item over $5K. For certain larger items, I had to provide
proof of both posession *and* ownership of the item, as well as proof of
alarms (fire/burglar).
But even without the additional rider, you'd know what you'd get in the
event of a 100% loss - it's the insured amount of your policy (as long as
you went along with the insurance company's valuation). The only place for
disagreement is in partial losses - what is the loss if, say, the kitchen
and bathroom burn? This is normally computed on a square foot basis (what
percentage of the usable floor space was damaged) though you can usually
get the company to make reasonable exceptions (a home theater in the living
room vs. furniture/clothes in a bedroom, for example).
As always, it's best to consult an insurance agent (preferably an in-
dependent agent who doesn't have a particular company/plan to push) and/
or a lawyer. All of the lawyers I've known would be willing to listen to
a brief summary (such as the one posted here) and tell you if they can
help you, or if you need some other type of advice from a different pro-
fessional.
Terry Kennedy Operations Manager, Academic Computing
te...@spcvxa.spc.edu St. Peter's College, Jersey City, NJ USA
+1 201 915 9381 (voice) +1 201 435-3662 (FAX)
Bob
Ted McLaughlin wrote:
> I don't know if this is the right place to ask this, or if there is another newsgroup out there for this. It sounds like most of the people in here know what they are talking about when it comes to houses, so here goes:
>
> A friend of mine lost his house to a fire a few weeks ago because of some electrical problem. The house was pretty much completely burned so he lost everthing. Luckily the family was visiting relatives when it happened so no injuries and they still had some clothes to wear :-).
>
> Now the problem comes with dealing with the insurance company. They want a "Proof of Loss" statement detailing: what was lost, how old it was, cost of the item, and the cash value of the item. For everthing in the house he has to come up with this. I got the feeling that the insurance company wanted reciepts for everything that he was claiming which was a joke because any reciepts he had would have gone up in flames.
You got the feeling, or they said that specifically -- big difference -- just ask the adjuster. Why sit around and wonder.
The proof of loss is a standard form used by all insurance companies. It is written specifically into the insurance policy, and you usually have 60 days in which to complete it -- do not be late, or request an extension if he is too busy to collect payment. I have a question: If your friend wants to be paid for his belongings, how does he expect to get the money unless he comes up with a list and the values? He is the only one who knows what the stuff is and what it is worth!
Most insurance companies realize that receipts are sometimes lost in the fire, and usually this is established immediately just by asking the adjuster.
The ages are needed because the insurance company pays based on a depreciated value of the item in question. If he has replacement coverage, the full replacement cost can often be obtained once the items are replaced. The cash value of the item is usually determined by the adjuster, but the original cost must come from your friend.
> So I wanted to ask this group what has been your experience with dealing with situations like this. Can insurance companies refuse to pay for all the items you claim, like say 50 CDs at $10 apeice if you can't name all of them, let alone come up with a reciept for each one? I was just looking around the house trying to imagine remembering all of the things I had if it happened to me, it scared me to try and imagine how difficult that would be. Little things like all of my computer games, which are around $45 apiece, could I name all of them that are crowding my shelves? Let alone the suits which are like $250, jeans at $20 and so on.
Have him finish the list as a priority, and ask the adjuster if he has questions -- don't be shy or adversarial. Be open because the adjuster is working to get him his money -- thats all they do! The sooner he finishes, the sooner he gets paid -- it is as simple as that. Usually people delay in confusion which causes hard feelings because no payment is made until a value can be established.
> Anyway, he is thinking about getting a lawyer because he is having so many problems with them. One of the guys at work mentioned something about a "Fair Reporting Act" or something like that that he should look into. The guy couldn't remember what it was for so I thought that I would toss that out too. Does it apply in this case, and if so, what is it?
Talk to the adjuster and if he/she cannot answer the questions, talk to their supervisors. What your friend wants is to be paid for the damaged items. If no satisfaction can be obtained, again, your adjuster can tell you what routes you can go; arbitration, lawsuits, and several other methods. Do not be shy, but be logical.
> We live in Minnesota so if anyone has any knowledge of specific laws that apply in Minnesota I would appreciate hearing from you.
Lawyers are your choice. They are usually not gotten unless the insurance company refuses to pay or if they are really late. But if the forms aren't even completed yet by your friend, he is delaying the payment, not the insurance company. Public Adjusters can be used if the guy wants someone to complete the forms for him for a fee, but I find that they usually are just an unneeded middleman who takes a percentage fee for filling out blanks on paperwork which your friend has to give the description, age, and cost anyway.
Overall, as you can generally get from my post, your friend must be open and honest with the adjuster. Ask for information. Do not be embarrassed that he does not know what to do. Ask for help in completing the forms and collecting the right receipts. I know your friend is a fire victim, but he has got to stop feeling like one and go get his money!
Bob
John Gilmer
Terry Kennedy <te...@spcunb.spc.edu> wrote in message
news:FFsy7...@spcuna.spc.edu...
> Dave <airk...@ix.netcom.com> writes:
> > As for your friend, it doesn't seem fair, but put yourself in the shoes
> > of the insurance company. Without requiring some sort of proof, can you
> > imagine how many people add things to their list that they didn't really
> > have? I think the company will probably work out a reasonable settlement
> > with your friend in the event he has no receipts, but it may come down
> > to compromise. The worst thing he could do would be to create animosity
> > (Until it's the last resort).
>
> A lot depends on the insurance company and the way the policy was
written.
> I bought my house for $70K and it was assessed (for taxes) at $149K. The
in-
> surance company initially wrote the policy for $149K and then sent someone
> out to look at the house (after closing) and they sent me a letter saying
> they wanted to insure it at $290K. I could either pay the increased
premium
> or they would de-rate any claims by about 50% (149/290). I complained but
> knuckled under. Now, this is just for the house and "normal contents" -
> clothing, furniture, average home electronics, and so forth.
Is this the place for the "How do you start a flood?" joke?
JLG
Nobody Important
Is everything depreciated? I can see that for say, a tv or vcr, but how about books, or china, or paintings? Some things actually go up in value with time, what happens with them, does the insurance company pay more (please, no laughter here)? And speaking of that, what about antiques? If a bedroom is totaled and you say the dresser was an antique, how do you prove that? Especially if it is one of those family heirloom type things.
The reason I ask about the books is I know a guy who has a library in his house, literally hundreds of books, some very old, some new. I am pretty sure he doesn't have reciepts for most of them and could not name them all to save his life, how would an insurance company handle that?
Just curious
Phlipflopr Beth
Once upon a time <AS8p3.82$mB3....@ptah.visi.com>, jus...@nobody.com
said...
> Is everything depreciated?
Yep, unless.......
> I can see that for say, a tv or vcr, but how =
> about books, or china, or paintings?
There are endorsements, aka riders, for "special" things like
collectibles, antiques, jewelry, computers, and other things. Generally
when purchasing the policy if this extra coverage is desired the item(s)
is appraised and insurance for a specific amount. Generally, computers
(only bringing that up since we all have one <G>) have a set limit in a
policy, sometimes as little as $500 and the amount isn't necessarily
covered in the "replacement cost" coverages because they're an item with
a limit. Jewelry also has a limit so if a diamond ring that cost $10,000
is stolen, the insurance company won't pay $10,000, with or without
receipts and replacement cost coverage. However, that ring can be
covered by endorsement for the appraised value.
> Some things actually go up in =
> value with time
These are the things that should be covered by endorsement and appraised.
Also, most insurance companies will want new appraisals every few years
but that's a good thing for the homeowner since the item's value will
have probably gone up as well.
> If a bedroom is totaled and you say the dresser was an =
> antique, how do you prove that?
That's something that needs to be dealt with while the policy is being
written, not when it's time to make a claim. Many homeowners are
disappointed and angry to find that their policy has limits on antiques,
jewelry, etc. It's important to read the policy, no matter how much a
person assumes they know about the insurance coverage, company or agent.
Also, there are Household Inventory forms available at certain web sites
and from most insurance agents. It's a tedious job but an important one
to inventory one's possessions as well as possible. Video taping things
is helpful too and then the tape should be kept elsewhere, a safe deposit
box, etc., to have an actual "record" of things lost. Photographs of
appraised jewelry helps also as does photos of any "high priced" item.
Hope this helps.
Beth
--
~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~
"I have a large seashell collection which I keep scattered
all over the beaches of the world......maybe you've seen it"
- Stephen Wright
To reply, remove the nospam from the email address.
Richard Masoner
In article <s7Po3.185$JK2....@ptah.visi.com>,
"Ted McLaughlin" <mcla...@nospamvisi.com> writes:
> Now the problem comes with dealing with the insurance company. They
> want a "Proof of Loss" statement detailing: what was lost, how old it
> was, cost of the item, and the cash value of the item. For everthing
> in the house he has to come up with this. I got the feeling that the
> insurance company wanted reciepts for everything that he was claiming
> which was a joke because any reciepts he had would have gone up in
> flames.
No, they won't insist on receipts. If they have replacement coverage
then they may need receipts for the replacement items, but that might
be negotiable.
It's a big job to itemize *everything* you own, and try to remember
purchase date and price. When our house burned down three years ago,
we went into stores, notepad in hand, writing down prices of
everything. It was fun.
For all of you folks "wondering" about whether your insurance covers
old books or homemade furniture, it's a simple matter to call your
insurance agent and ask and arrange for additional coverage, if
necessary.
Richard Masoner
Bob
Nobody Important wrote:
> >The ages are needed because the insurance company pays based on a depreciated value of the item in question. If he has replacement coverage, the full replacement cost can often be obtained once the items are replaced. The cash value of the item is usually determined by the adjuster, but the original cost must come from your friend.
>
> Is everything depreciated? I can see that for say, a tv or vcr, but how about books, or china, or paintings? Some things actually go up in value with time, what happens with them, does the insurance company pay more (please, no laughter here)? And speaking of that, what about antiques? If a bedroom is totaled and you say the dresser was an antique, how do you prove that? Especially if it is one of those family heirloom type things.
>
Yes, most HO policies pay specially for antique item. In other words, most items are settled at a percentage of their replacement value, called actual cash value. However, replacing an antique with a reproduction defeats the purpose, so antiques, valued by and expert appraiser, is paid at the appraiser's or a negotiated value. There are exclusions and other circumstances, but this is generally the case.
>
> The reason I ask about the books is I know a guy who has a library in his house, literally hundreds of books, some very old, some new. I am pretty sure he doesn't have reciepts for most of them and could not name them all to save his life, how would an insurance company handle that?
>
It is up to the homeowner to document the extent and value of the loss -- start making a list. and consider purchasing a separate policy for the books -- it is not expensive, but puts a value on the books before a loss for quicker settlement. Talk to your agent.
Try misc.industry.insurance for a modified newsgroup which will gladly answer these insurance questions.
John Haggerty
remember what you had in each room. the insurance company will need this
information to settle your claim, and will have to have an idea of what you
had, what you paid for it, what the actual cash value is, and what it will
cost you to replace it.
Since your friend is the one most familiar with the inventory, he is the one
in the best position to provide that information. If he decides to hire a
lawyer or public adjuster, he will still have to provide that information,
plus pay the middleman that will turn it over to the insurance company. In
other words, the insurance company will not pay more than the limit, but
your friend will need to take part of his payment and give it away to the
attorney or public adjuster.
You mentioned "Fair reporting Act", you're probably referring to Unfair
Claims Practices, which is what happens after you turn in your proof of loss
and the insurance company either ignores it or doesn't comply with the
policy. It doesn't sound like you're friend has reached this point, since
he hasn't provided the proof of loss yet.
Definitely have your friend contact his adjuster and work with him, it
sounds like he is looking for problems that haven't occurred yet.
Here's a note taken from one states Department of Insurance complaint page
(TX), too late for this loss, but good for the future.
http://www.tdi.state.tx.us/consumer/consum83.html
"Steps To Take Today To Avoid Future Complaints
Homeowners Insurance
Know what your homeowners policy covers. You may want more coverage for
certain items than your policy provides. For an added premium, you can buy
"endorsements." Endorsements are policy add-ons that cover items not on your
basic policy or increase the coverage you have. Some of the most common
endorsements increase coverage for jewelry, fine arts, camera equipment,
coin or stamp collections, computer equipment, and radio and television
satellite dishes and antennas.
Be fully insured. Check the limits of your homeowners or renters coverage,
including contents coverage. Your current coverage may be too low to replace
your property if you've made additions or new purchases or if the
replacement cost has risen because of inflation.
Review your deductibles to make sure they fit your current financial
situation.
Homeowners policies do not cover damage by rising water. Consider buying
flood insurance if damage from rising water is possible. For more
information about flood insurance coverage, contact your insurance agent or
company or call the National Flood Insurance Program's toll-free number at
1-800-427-4661.
Keep records of improvements to your property and automobile.
Make an itemized list of personal property including furnishings, clothing,
and valuables. Videotape or photograph your automobile and the inside and
outside of your home. Keep these photos or tapes in a safe deposit box or in
a location other than your home.
These precautions will help you settle claims and prove uninsured losses
that are tax deductible. "
You might also want to post your question onto misc.industry.insurance since
there's a lot of agents on that page that can give good advice.
John Haggerty
Ted McLaughlin <mcla...@nospamvisi.com> wrote in message
news:s7Po3.185$JK2....@ptah.visi.com...
I don't know if this is the right place to ask this, or if there is another
newsgroup out there for this. It sounds like most of the people in here
know what they are talking about when it comes to houses, so here goes:
A friend of mine lost his house to a fire a few weeks ago because of some
electrical problem. The house was pretty much completely burned so he lost
everthing. Luckily the family was visiting relatives when it happened so no
injuries and they still had some clothes to wear :-).
Now the problem comes with dealing with the insurance company. They want a
"Proof of Loss" statement detailing: what was lost, how old it was, cost of
the item, and the cash value of the item. For everthing in the house he has
to come up with this. I got the feeling that the insurance company wanted
reciepts for everything that he was claiming which was a joke because any
reciepts he had would have gone up in flames.
So I wanted to ask this group what has been your experience with dealing
with situations like this. Can insurance companies refuse to pay for all
the items you claim, like say 50 CDs at $10 apeice if you can't name all of
them, let alone come up with a reciept for each one? I was just looking
around the house trying to imagine remembering all of the things I had if it
happened to me, it scared me to try and imagine how difficult that would be.
Little things like all of my computer games, which are around $45 apiece,
could I name all of them that are crowding my shelves? Let alone the suits
which are like $250, jeans at $20 and so on.
Anyway, he is thinking about getting a lawyer because he is having so many
problems with them. One of the guys at work mentioned something about a
"Fair Reporting Act" or something like that that he should look into. The
guy couldn't remember what it was for so I thought that I would toss that
out too. Does it apply in this case, and if so, what is it? We live in
Minnesota so if anyone has any knowledge of specific laws that apply in
Minnesota I would appreciate hearing from you.
Thanks for all your help;
<RJ>
My insurance agent suggested I use a video camera.
Do a slow, complete room-by-room inventory
of your possessions.
Then keep the tape in a safe-deposit box.
That way, there's no question about what you own,
and what condition it's in.
Mike J Oropeza
> While not an answer for the current situation, some people recommend a
> videotape survey of your house to supplement your itemized inventory
> that you store off site. I know of this idea but have not done it
> myself. Wishful unpreparedness on my part.
We did this at our previous house. I walked around the house with my spouse
holding a camera. I went through each room and described the valuable items
contained, including when I remembered buying it, and the amount paid, and read
serial numbers where present. I even pointed out sentimental items.
Fortunately, I've had no loss and didn't need the tape.
--
Mike J Oropeza
Those who hear not the music, think the dancers mad ~{';'}~
Daniel Hicks
>
> Jim & Laura Behning wrote:
>
> > While not an answer for the current situation, some people recommend a
> > videotape survey of your house to supplement your itemized inventory
> > that you store off site. I know of this idea but have not done it
> > myself. Wishful unpreparedness on my part.
>
> We did this at our previous house. I walked around the house with my spouse
> holding a camera. I went through each room and described the valuable items
> contained, including when I remembered buying it, and the amount paid, and read
> serial numbers where present. I even pointed out sentimental items.
> Fortunately, I've had no loss and didn't need the tape.
If you don't have a video camera, you can use a still camera to at least
get a set of "jog your memory" shots. One of the disposable flash
cameras would work if you own no camera at all.