How to Submit a Homeowner's Insurance Claim
The process of submitting a homeowner’s insurance claim can be stressful — not only do you need to navigate your insurance company’s procedures but if something has happened to your home you’re likely operating under considerable stress. It might seem daunting, but if you break the process into smaller steps you can systematically work your way through the task.
- Typical home insurance costs
- Saving money on home insurance
- The bottom line
How to submit a homeowner’s insurance claim
1. File a police report
You won’t always need to file a police report, but it’s a necessity if you’ve experienced a break-in or vandalism. Your insurance company will want a copy of your police report as part of your claim.
Strive for the most accurate report possible, especially if you’re missing items from your home. It’s better to be accurate and thorough now to avoid confusion or delays further in the process. Note the age of any items and provide receipts if you have them. If you made online purchases you can review your account history to get an exact record of the price of your items and when they were purchased.
Remember, make duplicates of any police documentation for your records.
2. Take photos and video
Your insurance company will ask for proof of the property damage or vandalism, so make sure you take multiple photos and videos to include in your claim. This will be especially helpful in the event you want to appeal your insurance adjuster’s estimate in the future.
Also, if you’ve had to temporarily relocate due to damage remember to keep copies of your receipts detailing your expenses.
3. Contact your insurance company
Most insurance companies allow you to file or at least begin the claims process online before receiving a call from an insurance agent. Remember to include all the documentation you’ve amassed so far. You’ll receive a reference number, which you should carefully note in your documents.
For your convenience, you might want to ask if your insurance company has an app so you can manage details about your claim on the go.
4. Assess the damage with your claims adjuster
After submitting your claim, your insurance company will work with you to schedule a time for an adjuster to review your damage. This adjuster will be responsible for assessing the extent of your damage and can advise you further as to what your homeowners' insurance policy covers. Be prepared for your adjuster to ask questions about any pre-existing damage regular maintenance. If you had property stolen the adjuster will also want to know of any anti-theft or safety measures you had in place.
Your adjuster will then take all the information they have collected at your home and use that to create an estimate to let you know how much of the repair will be covered. Don't feel the adjuster is there to give you the lowest replacement costs or cost of repairs. Sometimes the adjuster, and an appraiser, if need be, may find further damage, understand the full benefits of your home insurance policy, and provide actual cash value for your payout.
Once you receive your estimate you’ll have a chance to review it and ask for a reassessment if you believe the result is too low. If you’ve received any estimates from contractors to repair the damage, you can include these as part of your argument.
5. Receive your funds
After you submit your claim there are a number of action items. First, you’ll have to make repairs to your home. Usually, you can interview your own local contractors and receive estimates to do the work, although sometimes your insurance company will have recommendations. Remember to let your mortgage company know about significant damages, in some cases your insurance company will require sign-off from your lender before releasing settlement funds. You’ll usually receive your insurance settlement after repairs have been completed and a final inspection has occurred.
Types of home insurance
There are many varieties of home insurance, all of which cover specific “perils.” In order for policyholders' damage to be covered by insurance, it needs to fall within the specific list of perils listed in your policy, known as a “form.” Here what homeowners insurance covers.
Dwelling and fire form
Dwelling and fire isn’t a common form of insurance since it covers so few perils and doesn’t cover any of your belongings or personal liability. Usually, this version of insurance is purchased by mortgage lenders on properties where the home insurance has lapsed.
Technically, basic form insurance is referred to as HO-1 insurance. Basic form policies typically cover what’s known as the 10 perils, which are:
- Fire and lightning
- Windstorm or hail
- Damage caused by aircraft
- Damage caused by vehicle
- Volcanic eruption
Broad form insurance is known in the insurance industry as HO-2 insurance, covering slightly more than basic form insurance. In addition to the 10 perils listed above, HO-2 insurance also covers:
- Falling objects
- Weight of snow or ice
- Accidental floods from home appliances or plumbing
- Damage from a hot water heating system, air conditioning or fire-protective system
- Freezing caused from home appliances or plumbing
- Accidental damage from electrical current
Special form insurance
This insurance, generally considered the most popular version of homeowner’s insurance, is sometimes also called “HO-3” insurance. It’s usually the minimum amount of insurance that your mortgage lender will require. It is considered “open peril” insurance, meaning it covers all forms of damage unless the policy specifically excludes them. For example, floods, earthquakes, and mudslides are not included. Remember, this doesn’t include your personal property. When it comes to property, HO-3 is considered “named” peril and only covers damage due to the 16 perils listed above.
Additional types of insurance
There are other, less common forms of home insurance that you could potentially opt for. These policies either provide more insurance coverage than those listed above or are geared toward renters, owners of mobile homes, or condo owners.
Home insurance companies
Considering switching home insurance companies? Here are some of the most popular insurers right now.
Relatively new on the insurance scene, Hippo was founded in 2015. They place an emphasis on technology that could attract younger homeowners.
Unique features: Hippo leverages technology to add value to their customers, offering a 60-second quote to get started and perks such as a smart home monitoring system and complimentary home maintenance.
Best for: If you’re looking for a modern home insurance experience, with updated policies that have been adjusted to cater to Millennial and Gen Z homeowners, Hippo could be a good fit for you.
Nationwide offers many different types of insurance, from home insurance to car insurance and even some investing advice.
Unique features: Nationwide is one of few insurers, like Hippo, to cover replacement of your belongings, not based on the depreciated value but on what it would cost to get a similar item now.
Best for: Nationwide’s multi-policy discounts help you save money if you buy auto, home or life insurance at the same time. If you’re looking for more than one insurance policy, Nationwide could be ideal for you.
State Farm is the largest home insurance company in the United States, with 18% of the market share. Like Nationwide and Farmer’s, they offer a number of insurance policies such as auto, home or life insurance.
Unique features: State Farm offers a multitude of extras you can add to your coverage including earthquake insurance, as well as insurance for additional structures on your property.
Best for: Like Nationwide, State Farm allows you to bundle insurance policies for a discount. This insurer is likely best if you’re looking for a large company with a breadth of expertise in the insurance industry. Also, their Spanish website makes State Farm ideal for those who feel more comfortable purchasing insurance in Spanish.
Typical home insurance costs
Not sure what to expect when it comes to paying for your home insurance? Here’s a guide to the financial language you’ll probably see once you start looking for home insurance:
- Premium: This is how much you’ll pay to keep your home insurance active. You’ll have to work this amount into your monthly budget. The most recent data, from 2017, shows the average premium for home insurance in the United States was $1,211.
- Deductible: Once you submit a home insurance claim, this is the amount you’ll be responsible for paying before your insurance company picks up the tab.
- Out of pocket costs: Keep in mind that if you need to make repairs to your home after damage has occurred, your home insurance company will probably expect you to pay for these repairs out of pocket, they’ll send you a check for reimbursement of funds per your estimate.
Saving money on home insurance
There are ways to reduce the amount your home insurance rates. Here are some ideas.
- Upgrade your home: Some insurers will offer you discounts for adding safety features to your home, such as an automatic sprinkler discount or a discount for having an impact resistant roof.
- Bundle your insurance: Insurers offering more than one insurance product will often give you a discount if you buy multiple policies at once.
- Increase your deductible: If you’re alright taking a bigger risk, you could increase your deductible to lower monthly payments. Remember, if there is damage you’ll have to pay for a larger portion of the repairs.
Should you submit a homeowner’s insurance claim?
Even though your insurance might cover all or part of a repair, some homeowners opt to take care of some repairs themselves. Here are the pros and cons of filing a homeowner’s insurance claim.
- Saves you money: If the repair is expensive and will be more than your deductible, filing a claim could help keep your finances stable.
- Recover total loss: If you’ve experienced the total loss of your home, filing an insurance claim is essential in helping you get into a new home.
- Covers cost of temporary housing: If the damage to your home is significant enough that it is uninhabitable, filing a home insurance claim can help cover the cost of your temporary living expenses.
- Increased premiums: If you regularly file home insurance claims, your insurer could start to view you as a riskier client and begin to increase your premiums.
- Not always more than deductible: Keep in mind the cost of your repair might not always exceed your deductible, which would make filing a claim unnecessary.
- Time-consuming: Filing paperwork, meeting with your adjustor and following up on your claim status take time. If the cost of your repair is estimated to be near your deductible, it might be worth considering whether filing a claim is worth your time.
Will my insurance premiums increase if I file a claim?
As with auto insurance policies, if you file a claim your insurance provider could increase your rates.
The bottom line
Don’t be afraid of your insurance company or of submitting a homeowner’s insurance claim. Sure, the process could be daunting to start, but once you break it down into smaller steps you can start to make the task more manageable. Make sure you document everything related to your claim and keep following up with your adjuster to get it processed quickly. Remember, if you’re finding that your home insurance company isn’t meeting your standards for customer service you can always opt to research new insurers and make a change.