A Step-by-Step Guide to Filing and Navigating the Process of Home Insurance Claims
Filing a home insurance claim is every homeowner’s most dreaded scenario because it means they suffered a loss or damage to their homes. While hopefully, you won’t have to be put in this position, if you do, it’s useful to know what steps to take to claim insurance.
Here we’ll look at a simple step-by-step guide to help Canadian homeowners when filing a home insurance claim. This will help you to navigate the home insurance claim process successfully and get your life back on track.
Step 1. Documenting Everything
Home insurance documentation is a vital first step. Start by completing a list of all destroyed, stolen, or damaged items in your home. Take photos of your home and review the images for any stolen items. Find any warranties, receipts, and manuals for damaged and lost items and cleanup.
When taking notes of the damages, be as detailed as possible. Don’t throw away damaged items unless they are hazardous to your health as they could be important for you home insurance claim settlement.
If you must dispose of something, confirm with your insurer first. Do your best to limit further damages because most insurance companies have this as a condition in their policies.
Step 2. Contacting Your Insurer
The next step for home insurance claims Ontario is contacting your insurer. Report any incident or basis for a claim to your insurer as soon as possible. Describe in detail what happened to cause the damages. When speaking with your insurance broker, discuss several factors before moving forward with the claim, including:
- The magnitude of the loss translated into approximate cost
- Your deductible, based on your policy
- Prior claims history
- Whether you can repair your home or damaged items without submitting a claim
- Potential consequences of the claim, such as losing a no-claims discount
If your home is unfit to live in after the damage, ask the adjuster whether you’re eligible for the Additional Living Expenses (ALE) based on your policy and, if so, for how long.
Most Canadian property insurance companies provide this coverage for condominium unit owners, homeowners, and tenants. However, there might be limitations under circumstances like mass evacuation.
ALE covers even above your regular expenses. For example, if you have to use certain facilities outside your temporary accommodation, like a laundromat, this might also qualify.
That said, ALE only covers costs that are above the normal amount you would spend if you weren’t displaced, not all your expenses during this period. Keep all receipts related to the additional costs.
Step 3. Filing a Proof of Loss
When making a claim, most insurers will require you to complete a “proof of loss” form. Here, you’ll list all damaged, destroyed, or lost items with the value.
Along with this, you’ll detail the cost of the damage or loss or, in other words, all the information you’ve collected during the documentation phase, including the make, model, and serial number, original price, place and date of purchase and location of items in the home.
You must sign that the statements in your claim are accurate. Otherwise, your insurer maintains the right to void your claim.
Most Canadian insurance companies require clients to complete and return this document in 30 days. If you must do a cleanup, discuss it with your broker or adjuster before you start a process. Provide information about the cleanup (length, what you or the company you hired did) to your insurer. Equipped with this information, the adjuster creates a settlement.
Step 4. Establishing Repair Costs
After gathering information about the damages, your adjuster will help you collect information about the repairs, including materials needed, and build an estimate. Once the estimate is complete, your insurer will present you with the settlement.
This will be either a cash payout or hiring a contractor to do the repairs. For some repairs, you might need to get quotes from contractors on your own. Your adjuster will advise you if this is necessary.
If the damages to your home are substantial, the repairs might be priced through tendering. This is a process that involves getting bids from several contractors and using their quotes to establish a repair budget. Your adjuster will guide you through this process.
Step 5. Starting Repair
Whether the repair costs are determined by a tender process, the insurer’s estimate, or your quotes, the adjuster will provide you with the repair budget your contractor has to do the repairs. The contractor must warranty their work.
Most insurers have preferred contractors and suppliers, but you can also use your own contractor. However, if your contractor charges a price different from the authorized quote, you’ll pay the difference. Once the repairs have been completed to your satisfaction, the insurer will reimburse you based on the authorized amount.
Step 6. Replacing Belongings
For any items that must be replaced, the adjuster will determine the replacement cost based on their value. Typically, the damaged property must be substituted without considering depreciation.
However, the value of items you can replace might be limited by a predefined amount on the policy and the list of damaged items. If your policy covers replacement costs, you can substitute items and claim the difference based on the determined replacement value later.
Or, you can get a partial reimbursement based on the actual cash value of the items (also known as the fair market value). Here, the age, the condition, and depreciation are also considered.
Final Thoughts
Now that you’re familiar with the process of home insurance claims in Canada, you have a higher chance of obtaining a smooth and successful outcome should you have to file a claim. Following a loss, refer to the above steps to navigate the claims process and advocate for yourself.
Document your damages, be honest with the information in your claim, work with the adjuster, and follow the correct repair procedure to avoid further losses or being denied a payout. If you have any questions about the home insurance process, make sure to contact Ron Johnstone Insurance today to see how we can help!