Common Policyholder Mistakes When Managing Water Damage Claims

Managing water damage insurance claims can be a complex and challenging process, especially for policyholders who have never managed a claim before. Policyholders, especially those experiencing their first claim, can make several common mistakes that can complicate the process, reduce their claim settlement or even result in their claim being denied.

Some of the most common mistakes policyholders make when managing water damage insurance claims include:

1. Delaying filing the claim: One of the most common mistakes policyholders make is delaying filing their water damage insurance claim. This can result in the damage getting worse and making it more challenging to identify the cause of the damage, which can cause delays and complications in the claim process.

2. Not documenting the damage: Another common mistake policyholders make is not documenting the damage thoroughly. Policyholders should take photos and videos of the damage, including the source of the water damage, any areas affected, and any personal property that has been damaged. The problem here is that in most situations, a lay person with no claim experience or knowledge of buildings would not be able to fully identify the scope of the damage.

For example, a wall could look perfectly fine visually. However using the right tools, the moisture level behind the wall can be determined, and the wall could show as being 90% wet behind the dry surface. Worse, there could be extensive mold damage that’s not visible on a visual inspection by the untrained eye.

3. Failing to mitigate the damage: Policyholders are responsible for mitigating the damage and preventing it from getting worse. This is their duty as the insured and this duty is explicitly indicated in the policy. Failing to take appropriate steps to mitigate the damage, such as shutting off the water supply or removing any standing water, can lead to further damage and complications in the claims process. Insurance policies require that policyholders take reasonable steps to prevent further damage. Failing to take these steps can result in the insurance company denying your claim or reducing the amount of compensation you receive.

A good example of this is when a roof is damaged, say by strong winds. If a policyholder does not take measures to cover the property with a tarpaulin, water could enter the home and cause damage if it rains. The insurer could refuse to cover this additional damage.

4. Not understanding their coverage: Policies can be complex and difficult to understand. It’s important to read your policy thoroughly and ask questions if you don’t understand something. Some policies may have exclusions or limitations that could impact your claim.

Policyholders should review their policy carefully and understand their coverage before filing a claim. Not understanding their coverage can result in unexpected denials or lower payouts.

5. Not hiring a professional: While policyholders can handle small water damage incidents on their own, larger incidents may require the services of a professional restoration company. Not hiring a professional can result in incomplete or inadequate repairs, which can lead to further damage and higher repair costs.

6. Waiting too long to start repairs: Finally, policyholders should start the repair process as soon as possible after filing a claim. Waiting too long to start repairs can result in further damage and complications, which can delay the claims process and increase repair costs.

7. Not understanding the claims process: The claims process can be complex and involve multiple steps. It’s important to understand what steps are involved and what documentation is required to ensure that your claim is processed efficiently and effectively.

8. Accepting a low settlement offer: Insurance companies may offer a low settlement amount in hopes that the policyholder will accept it. It’s important to understand the full extent of the damage and the costs associated with repair or replacement before accepting any settlement offer.

Trying to handle the claim on your own: Dealing with water damage can be stressful and overwhelming. It’s important to have a professional assist you in the claims process to ensure that you receive the appropriate compensation for the damage.