Even though we hope for the best, we still plan for the worst. In a previous article, I discussed college students and renters insurance. This week, let’s prepare for “what if there’s a claim.” Send this article to your college student. It could make a big difference if something happens.
BEFORE A CLAIM
1. Make sure you have replacement coverage.
Replacement cost coverage is optional, but it’s important, and you should have it. The “default” way to pay a claim is ACV (“Actual Cash Value”). ACV only pays what something was worth at the time of loss. That’s usually not enough to replace your lost things. Replacement cost coverage will make sure you get a new item of similar quality to replace the old item that was stolen or lost.
2. Know what your policy does NOT cover. Read the exclusions.
In almost all renters policies, there are “special limits” on things like jewelry, cash, precious metals, and other expensive items. In addition, there are limits on coverage if the items are stolen or damaged “off-premises.” The safest thing to do is discuss every expensive item that you own with your agent to make sure you have adequate coverage. Do this before you have a claim.
3. Keep receipts and photos of all your stuff somewhere safe.
List and photograph all of your possessions- especially the expensive items. Make sure you keep this documentation somewhere besides your residence. Most young people have a “cloud account” and should be encouraged to use it for this. You will need this at claim time.
AFTER A CLAIM
1. Immediately: Secure your property and the premises from further loss.
There’s a provision in most renters insurance policies called “Your Duties After Loss.” It’s an important section you should read. One of your duties (there are several) is that you are required to secure and protect your possessions from further loss. For instance, if the pipes in your apartment have burst, you are required to move your things away from the spraying water. Failure to take common sense steps to minimize damage and loss could result in a claim not paid.
2. As soon as possible: Notify everyone who needs to know about the loss.
Theft or burglary must be reported to law enforcement. All losses must be reported as quickly as possible to the insurance company. Almost all companies have a 24-hour reporting number. Finally, call your agent as soon as possible.
3. Over the next few days: Fully cooperate with claims adjusters.
Many claims are delayed because the insured does not return phone calls or emails in a timely fashion, or fails to supply necessary documentation. Don’t let that be you. If you aren’t sure, call your agent.
Call your local agent for more tips. The best time to discuss a claim is before a claim happens.
Bruce Sackrison is an insurance property and casualty broker affiliated with Professional Insurance Associates helping clients with insurance needs for personal, commercial and business insurance. Bruce can be reached at 707-931-0186, firstname.lastname@example.org