Homeowners insurance: Review your policy and document belongings for when disaster strikes

Here’s Schoeffel’s advice as well as tips from Howard White, the president of remediation company Maxons Restorations, which restored Schoeffel’s basement.

Review your policy before a disaster

Homeowners typically don’t know what’s covered until disaster strikes, White says. But it’s important to make sure you have adequate insurance before that happens because insurers won’t retroactively add coverage.

“Most homeowners don’t think about their policy until they actually need it,” White says. “So when you buy coverage, you should make sure that there’s adequate limits for what if the whole place burned to the ground, or what if all your stuff was destroyed?”

Insurance typically covers both the structure and a homeowner’s belongings, but White says common pitfalls include failing to insure a house for its actual replacement cost and ignoring the impact of inflation. For instance, a couch bought years ago for $5,000 could now cost $7,500 to replace.

Think twice before making small claims

Homeowners might be tempted to make small claims for damage, but White said that might backfire if an insurer determines those homeowners are bad risks and declines to renew their policies.

“I would save making a claim for something really catastrophic,” he says. “Like if it far exceeds your deductible by a factor of, let’s say, five.”

That’s what happened in the case of the Schoeffels’ basement, where the repairs were about four times as much as their roughly $2,500 deductible.

“It’s for the amount of the deductible as compared to what it would cost out of pocket to fix this problem,” Schoeffel said. “For me, it is well worth it.”

Call your agent

Once disaster strikes, call your agent, who can help walk you through your coverage and the process of filing a claim.

“The first thing I would do is call the agent and say, ‘Hey, I’ve had this loss. It looks like this. It smells like this. I have no idea how much it’s going to be’,” White says.

Document everything

Insurance companies will want to see the extent of the impact, and may send a claims adjuster to inspect the damage in case of large or complex claims. In smaller cases, the adjuster may settle the claim over the phone.

“Take photos, take video on your phone, Facetime with your agents so they can see the loss,” he recommends.

The documentation will also help contractors and remediation experts assess the scale of the project. And when a homeowner makes a claim, they’ll need detailed estimates to provide to the insurance agent, White says.

“If you just have an estimate from Joe’s contracting company that says $7,500, that’s not going to fly,” he says. “They’ll never pay for it. They need to be able to count it, qualify it and then pay for it.”

Schoeffel said her advice for other homeowners is to focus on the big picture. “Try not to let life and kids and everything else that we do every day distract you from the importance of your home and keeping your home safe and keeping your valuables safe,” she says.