I saw a story on the news about home insurance claims involving a contractor that was being accused of charging for work that was not done, and for not completing work, leaving the homeowner with their house torn up and big bills to pay. The reporter said the contractor is being investigated by the Construction Contractors Board, but the contractor told the reporter the real problem is with the insurance companies. I hope I never have a claim, but if I do, how can I be sure the insurance company will pay my claim?
If you do experience a loss, there are certain common requirements in insurance policies that must be met. You need to notify your company as soon as possible about the loss, protect your property from further damage, and make the property available for inspection. Having a contractor come in and start tearing out property before the insurance company has an opportunity to inspect the loss could jeopardize your claim.
The first step in working with your insurance company is to determine whether the loss is covered by the policy. We recently published our top 10 homeowner myths listing some of the more common issues that come up. If your insurance company determines the loss is not covered, it must provide an explanation that includes the policy language that applies. If you have questions about the position your company is taking, you can contact a consumer advocate here at the Oregon Insurance Division for assistance. Your advocate can review the policy language and the Insurance Code to be sure the company is in compliance with the terms of the contract and the law.
When it comes to selecting a contractor, we suggest using the same approach you would use to select a product or service if you were paying for the repair yourself. Check with family, friends and business professionals you know and trust for recommendations. Check with the Construction Contractors Board, the Department of Justice, and the Better Business Bureau for complaint information. Once you've narrowed down your choices, get itemized estimates that clearly identify the work that needs to be done. Sometimes the insurance company claim representative will write an estimate. We suggest sharing that with your contractor. Be sure you, the insurance company, and your contractor are in agreement before signing a contract or authorizing any work. Also, be sure you understand your obligation. For example, you will generally have a deductible to pay, and there may be limitations that lead to additional cost sharing.
Sometimes additional damage is found once the work is underway. If that happens, we suggest contacting the insurance company immediately. Depending on the extent of the additional damage, the insurance company may need to make another inspection. Your contractor can provide information but it's your house and we recommend that you stay in contact with the insurance company and the contractor to be sure there is agreement about additional repairs before continuing the work.
If you have questions about your home coverage, or you experience difficulties with your claim, the Insurance Division Consumer Advocacy Team is available at 1-888-877-4894. Information is also available on our website, www.insurance.oregon.gov.