When is an insurance claim NOT a claim you want to make?

By
Real Estate Agent with Coldwell Banker Rox Realty

Merriam-Webster defines insurance as:

Definition of INSURANCE 1 a : the business of insuring persons or property b : coverage by contract whereby one party undertakes to indemnify or guarantee another against loss by a specified contingency or peril

 

This blog is about "B" - loss by a specified contingency or peril.  We are all supposed to carry insurance on mortgaged property to protect the lender in case of loss.  NOTE I said lender - not you.  There are different types of coverage available and homeowners insurance typically covers the structure, contents and loss of use.  But your lender isn't concerned if you lose your furniture - they want their asset, the structure, protected. 

I read time and again in the local paper about a family experiencing a catastrophic loss.  And they didn't have insurance and are seeking donations.  This is a tragedy that could have been avoided for a few hundred dollars a year.  Money thrown away?  On average, yes.  Until you are the statisical loss - then it is the best thing you could have purchased.

But is every loss an insurance claim?  Not if you want to be insurable in the future!  And think twice if you are thinking of selling your property in a few years.  The C.L.U.E report is to show a buyer the claims history of the property. 

This is what my roof looked like a few weeks ago after a microburst hit the area.

roof

The roof over the garage along with the parapet walls were peeled back like a banana!  I contacted a roofing contractor I use and had him give me an estimate.  Just under $3K to repair, not something I wanted to pay 100% out of my pocket right now.  Even the deductible hurt, but it had to be done.  Yes, this was a necessary insurance claim and my carrier paid promptly.

The same storm caused two large trees to uproot at my daughter's house around the corner.                    Same insurance carrier, same agent. tree

 

Since there was no damage to any structure, no claim was filed.  Yes, homeowners insurance has coverage for tree removal available - but should you file a claim?  We already owned the chainsaw but if we didn't, a small one costs about $80.  It took about two hours to cut two large trees into smaller pieces and cart out to the back forty.  (Yes, we do live on acreage and hauled it out back).  I'm sure a professional tree service would have been easier but would it have been a smart financial move considering she wants to sell the place in a couple of years?  Probably not.

If you think you have a claim, talk with your insurance agent  to see if you should file a claim or pay for the problem yourself.  That $600 bill could cost you a lot more in future premiums and even affect your ability to secure low-cost insurance than it's worth!

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Rainer
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Bea Lueck

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