Written by Andy Gurczak

January 7, 2022

Homeowner or Business Total Loss Claims: Everything You Need To Know

Homeowner or Business Total Loss Claims

Homeowners and business owners maintain insurance policies to protect them from losses resulting from damage to their property. Unfortunately, certain events, such as natural disasters or major fires, can cause a great amount of damage to buildings, homes and personal property. Owners of the damaged property will file insurance claims with their insurance carriers. Significant damage to the insured property can lead to a homeowner or business total loss claim.

What should the policyholder do if they are facing a homeowner or business total loss claim?

What Types of Losses Result in Total Loss Property Damage Claims?

A total loss property claim occurs when the cost to repair or replace the damaged property is greater than the value of the property. A total loss property damage claim can happen to homeowners or businesses
For instance, a homeowner’s home and its contents could be destroyed in a fire. Or a hurricane could flatten a warehouse. If the cost to repair or replace the damaged property was greater than the value of the home or warehouse, the property insurance carrier may declare a total loss.

In that instance, the property insurance carrier would send the property owner funds to pay for the loss, up to the policy limits.

Insurance regulations vary from state to state. Some may permit the insurance company to declare a total loss if the repair or replacement cost equals 80% or 90% of the damaged property’s value.

Others may require carriers to declare a total loss when the repair or replacement costs of the damaged items are equal to or above the value of the damaged property.

Will My Insurance Coverage Pay to Repair the Damaged Property or Replace It?

It depends on how much it will cost to repair your property versus replacing it. Insurance companies are profit driven. Under the terms of the insurance policy, the insurance carrier can pick whichever option is cheaper. Depending on the amount of damages to the insured property, if it will cost less to replace the property, that is the route the insurance company will go.

Replacement Costs versus Actual Value Costs

Depending on your policy, the insurance carrier will either pay to replace damaged property or reimburse you for the actual cash value (ACV) of the damaged or destroyed property.

There can be a big difference between replacement and actual value costs.
Some policies provide coverage for replacement costs. For instance, water could destroy your washing machine and dryer in a major storm. Your carrier will replace the items with new appliances of the kind and quality that were damages.

However, if your policy provides for actual cash value reimbursement, the carrier will pay an amount equal to the value of the appliances minus the decline in value over the years. If the washing machine is several years old, the homeowner’s insurance will only pay a portion of what it costs to replace it because of its age.

What Should You Do if You Have Major Damage to Your Home or Business?

There are several steps you can take if a fire or natural disaster severely damaged your home or business.

Notify your insurance company. Your policy requires you to notify them of damages to the property within a certain time period if you intend to file a claim. See your declarations page.

Take pictures of the damage to your property, including personal property. The more pictures you have, the better your claim will be.

If your home or business needs temporary repairs, make those repairs. Holes in roofs or broken windows and doors could let rain into the building, causing additional damages. The insurance company will not pay for additional damage to your property if you fail to secure it.

Prepare an inventory of damaged property, including personal property. Gather any receipts for purchases of damaged appliances, computers or televisions.

If you have to move while repairs are being made, keep receipts for meals, travel expenses, hotels, etc. You can file a claim for Additional Living Expenses (ALE).

Get written estimates for all repair costs.

Do You Need a Public Adjuster?

The insurance company will send an insurance adjuster to inspect your damaged property. That adjuster, also known as a claims adjuster or company adjuster, works for the insurance company.

Or the insurance carrier may send an independent adjuster to inspect your property. Independent adjusters also work for and get paid by the insurance companies.

On the other hand, public adjusters only work for the owners of damaged property who are submitting insurance claims. The state licenses them. Many have worked as adjusters for insurance companies in the past.

You may be concerned that your insurance company is not resolving your claim quick enough. Or you think the amount of money they are offering you is too low. If so, you should hire a public adjuster.

A public adjuster can help you determine if you need repairs or replacements for your damaged property. He will calculate the settlement amount you will need to cover the cost of replacing or repairing your damaged property.

Moreover, a public adjuster will negotiate a settlement on your behalf.
Lastly, you do not pay the public adjuster until they settle your claim. He receives a percentage of your insurance settlement.

If you are looking at a total loss insurance claim, you will need the help of an expert to get the insurance settlement you deserve.

If You Need a Public Adjuster, Call AllCity Adjusting

We are a family-owned claims company with five decades of combined adjusting experience. If there’s one thing we understand, it’s that you need 100% of your claim value.

Insurance companies undervalue your claim 8 out of 10 times. They hire expensive claims adjusters to ensure they maintain a strong profit margin. They have experienced actuaries that help their team of agents challenge your insurance claim’s validity and value.

You have already gone through a tumultuous event. Get an agency that gets you more during the claims process.

At AllCity Adjusting we work to ensure you get 100% of your claim value. With over 50 years of combined adjusting experience, we know insurance companies and understand where they cut corners. We help you build a larger claim, maximize your claim value, and get you back to normal fast.

Don’t get fooled, get the company that gets you more. Call us today at 844.692.3587 or visit our website to find an office near you.

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Best way to beat the insurance company is to hire AllCity Adjusting

At AllCity Adjusting we help residential and commercial clients alike get the claims support they need. Moreover, we have over 50 years of combined experience helping get our clients the max settlement time and time again. If your claim has been low balled or denied entirely we can help increase your maximum settlement. Call us today for a FREE consultation. Experience the AllCity difference.

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Salvageable v. Non-Salvageable Property After a Fire

Salvageable v. Non-Salvageable Property After a Fire

If a fire has occurred at your home, your first concern, of course, is the safety of yourself and your family. However, depending on the extent of the fire damage, you will have to resolve the issue of salvageable v. non-salvageable property after a fire. Homeowners’ insurance protects your home itself (Dwelling Coverage) and its contents (Personal Property Coverage). High heat, smoke, and soot can cause extensive damage to your personal property, such as clothes, furniture, hardwood floors, and appliances. For instance, smoke damage causes fabrics, clothes, and soft goods to reek of the smell of smoke. Additionally, smoke and soot can discolor objects and reduce the life span of electronics and machinery. Consequently, you and your insurance company will have to determine which personal property is salvageable v. non-salvageable property after a fire.

Actual Cash Value v. Replacement Cost Value

Actual Cash Value v. Replacement Cost Value

Many homeowners never read their homeowners’ insurance policy. Then a covered loss, like a fire or hurricane, causes extensive damage to the home and contents. Of course, the homeowner files a claim with her insurance company. Eventually, the homeowner gets a claim settlement offer from the home insurance company. However, only then does the homeowner learn the difference between actual cash value v. replacement cost value coverage.

What is an Appraisal Clause in an Insurance Policy?

What is an Appraisal Clause in an Insurance Policy?

Water damage insurance claims are some of the most frequent home insurance claims that homeowners file. However, homeowner insurance does not cover all types of damages caused by water. Therefore, handling water damage insurance claims requires the homeowner to be careful and diligent before and during the claims process.

Homeowners’ Property Damage Claim-Do You Need an Attorney?

Homeowners’ Property Damage Claim-Do You Need an Attorney?

Unfortunately, a terrible storm moved through your area. It left fallen trees and damaged homes in its wake. Your house was one of them. You have never filed a claim with your homeowners’ insurance company. But you now have a homeowners’ property damage claim-do you need an attorney?

How to Negotiate a Fire Damage Insurance Claim

How to Negotiate a Fire Damage Insurance Claim

One of the most traumatic events experienced by homeowners is a fire in their homes. Certainly, the potential for serious injury can be significant. However, the relief that no one was harmed soon fades away as the reality of the property damage sinks in. Now, one key question for the homeowner will be how to negotiate a fire damage insurance claim settlement.

Insurance Claims for Poorly Installed Stucco

Insurance Claims for Poorly Installed Stucco

Stucco is a popular siding used on new developments, homes, and businesses since the early 1900s. Manufacturers make it of cement, limestone, and silica. In fact, it has become very popular in the last 20 years. However, when not installed properly, it can lead to several problems. Therefore, some homeowners will have to file insurance claims for poorly installed stucco.

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