The Best Insurance Info You Will Ever Read!
Disclaimer: I am not a lawyer or an insurance agent. The info contained herein is strictly my point of view or opinion (and we all know what that means) and experience.
Have you read your insurance policy—ever? Do you really understand what you are paying for each month? Probably not. We all have certain expectations of what our residential homeowner’s policy is supposed to do.
I won’t bore you with the history of roofing contractors insurance in Springfield, MO. However, if you ever have a sleepless night, reading the history of insurance on your policy might just be the antidote.
All of the information below is, in some way, key things you should probably know about your policy. I see, EVERY DAY, hard-working people get shocked by their insurance company because they had no idea what was actually in their policy. Their typical response is, “Oh, my insurance guy won’t screw me…” Oh really? He has no control over it, and he is being paid by the carrier. I watch it happen daily! Here is why: #1 wrong type of policy, #2 high deductible, #3 inadequate coverage, #4 running a business out of your home, and the list goes on and on.
Here are a few things I do with my property and insurance coverage.
- Write down everything I want coverage for and how much.
- Take pictures spring and fall of exterior – all sides – and, if possible, roof.
- Interior contents, make a list and photo document all items and values, upload to the cloud (this is extremely important in tornado and hurricane-prone areas).
- Keep property clean, perform regular maintenance, and mitigate loss opportunities.
What most people do not realize is that insurance is not covering your car or house or other material items. It can’t, because it cannot pay those things. Insurance covers you finally, that is it. Insurance should be heavily contemplated and be used in all of your financial decisions as a whole, not a part.
I could write hundreds of pages, maybe even get into a thousand or so, of the ins and outs of claims and the process of which to properly settle, but no one would read it.
Please take a few minutes and scan through the information below. Just know that when you are trusting Cook Roofing Co. with one of your larger investments that you have trusted the best. You have trusted a roofing company who trains its people on all kinds of insurance procedure, roofing installations, other construction procedures, ethics, and integrity. This is the sole reason that when we are done with your roof we are happy to give to you a Lifetime Workmanship Guarantee.
Understand the process of construction activity at your home. First of all, this can be a very stressful event, if not properly set up. Communication between you and the contractor is key. 10 things to ease the construction burned include:
- What to expect—the process.
- Start and stop times.
- How are we going to communicate and with who?
- Have a pre-construction meeting. Address concerns here.
- Be open-minded; construction is often noisy and dirty.
- Be realistic about your expectations. Remember to be specific in the pre-construction meeting.
- Remove any wall hangings and valuables that could easily fall or get damaged.
- Photo and document your home prior to construction and share that with the contractor.
- Pay as you agreed to. Often this becomes the place when the fighting begins. Get clear on what the targets are if multiple payments are to be made.
- Breathe. It is all good!
Quick Basic Understanding & Policy Types
Typical coverage types that we run into on a daily basis.
Basic Form – a basic form homeowner’s policy is just that—basic. It will usually financially safeguard against 10 named perils:
- Fire or Smoke
- Hail & Windstorms
- Damage from Vehicles
- Damage from Aircraft
- Riots & Civil Commotion
- Volcanic Eruption
Broad Form – A broad form policy is a more common type of homeowner’s coverage. It covers all the perils in an HO-1 policy, plus:
- Falling Objects
- Weight of Ice, Snow, or Sleet
- Freezing of Household Systems like AC or Heating
- Sudden & Accidental Tearing Apart, Cracking, Burning, or Bulging or Pipes & Other Household Systems
- Accidental Discharge or Overflow of Water or Steam
- Sudden & Accidental Damage from Artificially Generated Electrical Current
Special Form – The HO-3, or “special form,” policy is the most common type of homeowner’s insurance, namely because of its broad range of coverage and general affordability. It covers all the perils mentioned in the HO-2, or “broad form,” policy, but also goes further than that.
Because an HO-3 doesn’t limit coverage only to named perils, it often can provide more financial protection than an HO-2. That means your typical HO-3 form can financially protect you against any and all perils unless your policy specifically mentions them in the exclusions—if it doesn’t, you are covered.
The HO-3 policy typically insures your home and attached structures (like a garage or deck), as well as your belongings, and your personal liability, if you accidentally injure someone or damage their property.
What you are and aren’t covered for will depend on your specific policy, so it is always wise to go over everything with your insurer. Earthquakes and floods are generally excluded from coverage on most HO-3 policies.
1. There Are Dwelling Policies (DP) & Homeowner Policies (HO)
Dwelling and homeowner’s insurance are designed to provide coverage under two different circumstances. Homeowner’s insurance covers personal property and provides personal liability protection as standard, as well as coverage over the building itself. Dwelling insurance, sometimes called “second home insurance” or “investment property insurance” only covers the building.
2. Property Floaters
A personal property floater is a separate insurance policy that covers a valuable item. Insured persons can set the coverage amount on a personal property floater so that it will fully replace the valuable item that gets lost, damaged, or stolen. Personal property floaters are used to cover valuables like jewelry, artwork, firearms, furs, silverware, and other expensive pieces of property.
Who Is Covered?
In this policy, the words “you,” “your,” and “yours” refer to the person or persons named on the Declarations Page and his or her “spouse” who lives in the same household. The words “we,” “us,” “our,” and “ours” means the insurance company named on the Declarations Page.
Insured Person Means:
- You or a family member;
- An additional insured named in the policy;
- A spouse. A spouse is a marriage partner. The term spouse also includes an individual registered under state law as a domestic partner of the insured person shown on the Declarations Page.
Property damage means physical injury to, destruction of, or loss of the use of tangible property and the resulting loss of its use.
Making a Claim
It is best to always put in writing a given written notice. You can notify your agent or the carriers directly. Most policies require written notice and could become an arguing point if litigation ever becomes necessary. Being vague seems to be the best: “I believe I have damage. Please have a licensed adjuster who has the authority to settle my claim, investigate and estimate all reasonable and legitimate items.”
I believe that every policy I have ever reviewed states that the insured must protect the property from further damage. For example, if the wind blows some shingles off, your response may be to have a roofer just nail new shingles down. However, the proper way to handle this is to have your roofer tarp the damaged area up and over the ridge. This prevents water intrusion. Then you can make a claim to the insurance.
Have your contractor on-site to walk the property to meet the adjuster. Most states prohibit exterior contractors from negotiating price with the carriers, so make sure the contractor is aware and only negotiates the actual scope of the work and not the price.
- Your Duties
- Your duty is to notify your agent or broker of a change in occupancy.
- Your duty is to notify your agent or broker at the beginning of any renovation or construction work and throughout the work to maintain an appropriate amount of coverage and confirm that appropriate protective safeguards are in place as determined by us.
- Your Duties After a Loss
In the event of an occurrence, which is likely to involve this policy, or if you or any other insured person under this policy is sued in connection with an occurrence which may be covered under this policy, you or an insured person must:
- Give prompt notice to us or your agent or broker.
- Protect the property from further damage. If repairs to the property are required, you must:
- Make reasonable and necessary repairs to the property; and
- Keep an accurate record of all repair expenses.
A public adjuster is a professional claims handler claims adjuster who advocates for the policyholder in appraising a negotiating a claimant’s insurance claim. Aside from attorneys and the broker of record, public adjusters licensed by state departments of insurance are the only type of claims adjuster that can legally represent the rights of an insured during an insurance claim process. A public adjuster will be most beneficial when it is clear that the insurer will pay the claim and the only issue is the proper identification and valuation of the loss. Most public adjusters charge a percentage of the settlement. Primarily they appraise the damage, prepare an estimate and other claim documentation, read the policy of insurance to determine coverages, and negotiate with the insurance company’s claims handler.
A public adjuster is a representative of the policyholder who advises, manages, and submits a claim to the policyholder’s insurance company.
There are three classes of insurance claims adjusters: staff adjusters (employed by an insurance company or self-insured entity), independent adjusters (independent contractors hired by the insurance company, and public adjusters (employed by the policyholder). “Company” or “independent” adjusters can only legally represent the rights of an insurance company.
My insurance denied my claim. Request a second opinion—and get to work gathering all of the pertinent information—forensic weather report, manufacturer inspection, building consultant, engineer, etc. The most effective way of handling a denied claim is to engage a public adjuster.
The insurance is only partially paying my claim. Again, the best method is to engage an experienced public adjuster. In the event the insurance carrier and public adjuster (PA) are not able to come to terms, then you have a nuclear option with your policy, and that is the appraisal process.
Insurance claims typically get denied for the simple reason that the staff adjuster or independent adjuster does not have the experience and/or authority to settle a claim. I have seen, on several occasions, claims are denied because of complexity and the adjuster is overwhelmed, and that carries all the way through the company. Simply put, insurance companies and independent adjusting companies DO NOT TRAIN THEIR PEOPLE ON DAMAGE, they only train on complying with the paperwork. That is why time and again a majority of claims end up in appraisal and/or litigation.
If you and we fail to agree on the amount of loss, either party may make a written demand that each selects an independent appraiser. In this event, the parties must notify each other of their selection within twenty (20) days. The independent appraisers will select an arbitrator within fifteen (15) days. If an arbitrator is not agreed upon within that time, either party may request the arbitrator be selected by a judge. The independent appraisers will then appraise the loss and submit any differences to the arbitrator. A decision in writing agreed to by the two appraisers or either appraiser and the arbitrator will be binding. Each appraiser will be paid by the party that has selected the appraiser. You and we will share the expenses of the arbitrator equally.
I did want to tell you that the insurance company could potentially be scamming you, screwing you, or otherwise. However, after a chat with the legal department, they quickly frowned upon it and thought that our own company liability insurance might get tried on for size. So, with that, I will share with you my opinion about some newer types of policies hitting the street.
They have a roofing schedule in them such as Roof Surface Payment Schedule and Schedule Roof Payment Percentage. They simulate a waterfall and the older your roof the more you lose, and you lose big. If you have an ACV policy, then don’t even think about getting a roof claim payment. It is most likely not going to happen. So, if you encounter this type of policy then buyer beware is all I can tell you. There are plenty of great carriers who won’t do this to you.
|Average National Roof Cost $8,000 with a $2,000 Deductible|
|Roof age||RSPS Penalty||RC payment after RSPS Penalty||After Deductible|
|0||0% - $0.00||100% - $8,000||$8,000|
|5||15% - $1,200||85% - $6,800||$4,800|
|10||30% - $2,400||70% - $5,600||$3,200|
|15||45% - $3,600||55% - $4,400||$2,400|
This chart is a typical RSPS, and I personally do not believe that this is insurance as you or I would know it. Insurance is transferring of risk. I pay you and you cover me. Not I pay you and you chose what you will cover and what you will only partially cover. What is going on in scenarios such as this is they are selling you a replacement policy and charging for that policy and only giving you essentially as what would be recognized as a ACV policy.
So please beware of these types of policies. At least now you are somewhat aware.
Contact us with any questions you have about roofing contractors insurance. We take great pride in educating homeowners throughout the Branson and Springfield, Missouri, area on how to get the most out of their insurance options.