How to Get Your Insurer to Pay Your Home and Auto Claims

Follow these steps to minimize hassles and get all the money you deserve.

Folder with close up on the word claims and a note where it is written under investigation. Concept of insurance fraud, 3d Illustration
(Image credit: Getty Images)

Most insurance claims take more than one phone call or meeting to resolve. If you have a homeowners or an auto claim, here’s what you need to know to avoid hassles and get a fair payment from your insurance company.

4 Steps to file and collect on your homeowners insurance claim

Andrea Johnson went for years without filing a homeowners insurance claim. But one afternoon in May, the sky went dark and a tornado with 200-mile-per-hour winds ripped through her hometown of Moore, Okla.

The tornado wiped out so many houses that she had a hard time finding her street when she returned. “The neighborhood behind ours was totally destroyed and was just debris,” she says. Only a few houses on her block were still standing. One side of her home was completely gone, “and my neighbor’s house was in my house."

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1. Act fast. When you file a claim that involves damage to your home, an adjuster usually comes within 24 to 48 hours, but it can take longer after a catastrophic event. Johnson contacted her State Farm agent after the tornado, and she met with the adjuster three days later to determine the extent of the damage. Johnson also contacted a builder who came to the site with an engineer and sent the insurer a report explaining why the house was unfixable. “The insurer finally decided it was a total loss,” she says.

Your insurer or agent may help you find contractors, water-remediation services and other experts to help make the repairs, or you can use your contractors. It can help to have your contractor at your house when you meet with the adjuster. “They can walk through together, and we can assure they’re both seeing the damage from the same perspective,” says Patrick Gee, senior vice president for auto and property claims at Travelers. The insurer may adjust the payout if the contractor finds more problems after starting the work.

2. Take inventory. Filing the claim for the contents of Johnson’s home was complicated. She had little evidence of her missing possessions when the adjuster arrived. Some possessions had been tossed in the trash by well-meaning volunteers and others had been scattered by the tornado. “They asked for page after page of information to tell them about everything — how many pairs of shoes, how long you had them, how much they cost. Who remembers that?” she says. Johnson wishes she had kept a home inventory or taken pictures.

Keeping an updated inventory isn’t the tedious hassle it used to be. Many insurers have home inventory apps you can use. “Take pictures of your rooms, closets, attic, and backyard,” says John Doak, Oklahoma’s former insurance commissioner. Open drawers and cupboards so that the photos show all your possessions. Keep the photos and copies of receipts for valuable items off the premises, with your insurance agent or online. If possible, have your insurance agent visit your home, take pictures and let you know if you’ve reached your policy limits, says Doak.

3. Know what’s covered. Most homeowners' policies pay for additional living expenses — including your rent, food and other costs — for up to a year while your home is unlivable. Keep the receipts for reimbursement; some insurers provide debit cards for these expenses. State Farm paid Johnson’s rent for a small apartment while she waited for her claim to be settled.

In a disaster area, you may be out of your house for a long time because of a shortage of contractors. “You could potentially be paid more for the additional living expenses than for the home if you’re out of your home for a year or more,” says Doak. Johnson decided to take the insurance money and move to Oklahoma City rather than rebuild her house.

Periodically review your policy or ask your agent what is and isn’t covered and how to fill the gaps. Homeowners insurance doesn’t include flood insurance, but you can get a policy from the National Flood Insurance Program; your home insurance agent may sell those policies. Sewage and drain backups usually aren’t covered automatically, but a rider may cost just $50 to add about $10,000 in coverage, says Rene Hernandez, an independent agent in Oklahoma City.

Most policies cover only about $5,000 worth of jewelry, but you can add a rider to cover the appraised value.

4. How to fight back. If your insurer drags its feet or you don’t think you’re getting adequate reimbursement, you can get help from your state insurance department. “If there’s an impasse, the insurance department can step in and speed things up,” says Doak, whose office fielded about 30,000 calls to help policyholders in one year. The Oklahoma Insurance Department, like departments in many states, sets up a mobile office to answer consumers’ questions about their coverage and rights after a major disaster. It also offers a mediation program to help resolve disputes between homeowners and their insurance companies, an option several state insurance departments offer. 

4 Steps to file and collect on your auto insurance claim

The steps you take immediately after a car accident can make a huge difference in how quickly and smoothly the claims process goes. Preserving evidence and filling out a police report create a record to support your claim. 

1. Gather evidence. If you don’t have a smartphone camera with you when you drive, keep a disposable camera in the glove compartment. If you’re in an accident, start taking pictures when it’s safe — capture images of your car, the other car, the intersection, and the other driver’s license and insurance card. You may even want to take a photo of the other driver. Also, keep a notebook and pen by the driver’s seat so you can jot down a license plate number quickly, says Sharon Jansma, owner of Jansma Financial and Insurance Services in Visalia, Calif.

If there are witnesses, get their contact information. Having a police report can help, especially if there’s a question of who’s at fault. “Don’t tell anyone the accident was your fault, even if you think it was,” says former State Farm spokesman Kip Diggs. “Don’t sign any document unless it’s for the police or your insurance agent.”

Most insurers, including State Farm and Travelers, have mobile apps that make it easy to submit photos and walk you through the next steps. Or you can call your insurance company or agent

2. Find the right shop. You can usually use any body shop, but most insurers have preferred shops that work directly with the adjusters and guarantee their work. This can speed up the claims process, but it can help to have a second opinion. If you have rental car coverage, your insurer will pay for at least a portion of the cost of a rental car while yours is in the shop.

If the car is a total loss, the insurer will generally pay “actual cash value” (the market value for a car of its age and condition). Ask how the insurer came up with the number. Farmers compare the cost of cars selling in the area that are the same make and model, with similar mileage and upkeep, then adjust the figure for your specific details. “I like to see a sample size of five to 10 cars selling in your area,” says Jansma. If you think the number is too low, gather your list of similar cars for sale locally. The insurer will either send you a check for that value (minus your deductible) or pay the financing company and send you any additional money if you have a loan.

3. Delays common to two-party accident. Claims can get complicated — and take longer — when another car is involved. It usually takes 60 days or less, says Jana Schellin Foster, who is a Property & Casualty specialist at Nevada Insurance Agency Company in Carson City, Nev. “Anything beyond that, somebody is dropping the ball.” In that case, Foster will generally have a conference call with the agent, the insurer and the customer. “That way there is no miscommunication,” she says.

The final payment can be delayed while the two insurers decide who is at fault. A typical scenario: Your insurer pays the claim while you pay your deductible, even if there’s a good chance you weren’t at fault. Your deductible could be returned to you months after the insurance companies determine who is to blame. That process, called subrogation, can take 10 days to a year, says Jansma.

4. How to fight back. If the insurer is lowballing you about the repair costs, ask your body shop to provide a detailed estimate of what needs to be fixed. If that doesn’t help, find out if you have an “appraisal clause” in the policy, under which a third party reviews your body shop’s appraisal and the insurer’s and settles on a number.

Your agent may be able to help with stalled claims. “You may have one claim in a lifetime, but we do this every day,” says Sarah Brown, of Keller-Brown Insurance Services, in Shrewsbury, Pa. As an independent agent, she often has contacts at the other driver’s insurance company, so her clients can find out what’s causing the delay. The state insurance department can also explain your rights and get the insurance companies moving.

Check an insurer’s record of complaints

One way to minimize the chances of having claims problems is to avoid insurers with a history of hassling people at claim time. You can look up the insurer’s complaint record with the National Association of Insurance Commissioners consumer insurance search.

Type in the company’s name, then click on “property/casualty” for the business type for auto and homeowners insurers. When you see the list of companies, click on “closed complaints,” then select “closed complaint ratio report.”

You’ll see a ratio of the insurer’s market share of resolved complaints to the company’s market share of premiums for that type of insurance (so larger insurers aren’t penalized for having more complaints). The national median is 1.00; companies with ratios below that median have a better track record than those above the median.

You can also contact your state insurance insurance department to learn about any actions taken against the insurer.

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Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.

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