Fire Insurance Claims: Tips & What to Expect for Fire Damage Insurance Claims
All ordinary homeowner and commercial insurance policies cover fire damage.
However, many home and business owners are disappointed by the fire damage insurance claim process. Some insurers offer much less than expected. Quite often, home and business owners don’t understand their coverage until after a fire occurs.
Fire insurance claims can be messy and expensive. We want to help.
Keep reading to discover how fire damage insurance claims work – including our best tips based on real-world experience.
How the Fire Insurance Claim Process Works
Fire causes different types of damage to a property.
Some fires fully destroy a property, burning your home to the foundation. Other fires only burn one or two rooms of a home or building. Some have little structural impact to a home or commercial building but cause extensive smoke and soot damage.
No two fire damage insurance claims are alike. However, here’s how an average fire damage insurance claim works:
- Secure the Scene: Put out the fire or call 911. Make sure every person and pet in your household is safe. Take steps to limit further damage, if you can safely do so (say, by putting a tarp over a hole in your roof created by the fire).
- Contact Your Insurer & Start the Claim: Call your insurer’s 24/7 claims reporting hotline. The insurer gives you a claim number, then explains the next steps.
- Wait for the Adjuster: Your insurance company sends an adjuster to the scene to verify the damage and advise on the next steps. The adjuster may recommend an emergency restoration contractor, for example, to secure the scene.
- Accept Emergency Funds: The adjuster may authorize the transfer of emergency funds to you. This money can cover the cost of alternative accommodation and food if forced to leave your house, along with other unexpected costs you incur as a result of the fire.
- Get Multiple Estimates: Your insurer may tell you how much it costs to repair the damage. This estimate could be 100% accurate. In most cases, however, it’s a good idea to get multiple estimates. Your insurer could be underestimating repair costs, leading to an undervalued claim.
- Restore & Repair Damage: Fire damage restoration contractors repair your property to pre-loss condition. They’ll repair or replace damage and identify items that can be salvaged.
- Keep Receipts & Document Everything: Throughout this process, be sure to keep receipts for everything – including hotels, meals out, tools, contractors, and more. Your insurance should cover all reasonable costs you incur as a result of the fire damage insurance claim. You should also document everything – say, by taking photos and videos of damage and tracking all communication with the adjuster.
- Inspect Your Entire Property for Damage: Fire damage insurance claims can be messy because damage can cover your entire property. Your fire may have occurred in the kitchen, but smoke and soot spread throughout your home via your HVAC system. Inspect your entire property for damage or hire a trusted contractor to verify you’re not missing any damage.
- Consider Hiring a Public Adjuster: Public adjusters are licensed insurance industry professionals who represent your side of the claim – not your insurance company. They want to help you receive the maximum possible amount for your insurance claim. They also speed up your claim and ensure a smooth repair process. Some hire a public adjuster after an insurance dispute – say, a denied or reduced claim. Others hire public adjusters from the outset of a large fire damage insurance claim.
How to Deal with an Insurance Adjuster After a House Fire: The Best Tips & Strategies
Your insurance company sends an adjuster to inspect the damage and explain the next steps to take.
The insurance company’s adjuster is a salaried employee or contractor who works for your insurance company. The adjuster’s goal may be to minimize fire insurance claim settlement – not provide you with as much money as you like.
Remember: insurance companies are for-profit businesses. They want to pay you as little for your claim as they’re legally obligated to pay. Insurance companies use adjusters to help accomplish this goal.
Unfortunately, most homeowners have zero experience with large fire damage insurance claims. This inexperience puts them at a disadvantage.
We want to help. With ClaimsMate, you can hire a public adjuster to speed up your fire damage insurance claim, increase payout, and receive the correct amount of money for your claim.
Other tips for dealing with your insurance company’s adjuster include:
- Document All Additional Costs: A standard homeowners insurance policy covers additional living expenses (ALE). Look for an “ALE” section on your insurance policy. If a house fire destroys your home, then you may need to live in a hotel for weeks. ALE covers accommodation, reasonable meal expenses, toiletries, and other costs you incur as a result of moving out. Document all of these additional costs, as they can add thousands to your claim.
- Take Photos & Videos: The more visual evidence you have, the better. Many homeowners are surprised how much evidence insurers request after a house fire. The more photos and videos you have, the better. Take photos and videos of damaged property, damaged items, and everything else before the cleanup process starts.
- Create a Home Inventory Before a Loss: Insurance experts recommend keeping an updated home inventory. This inventory lists items in your home, their purchase date, and their value. Some even attach receipts or images of receipts to this home inventory. A good home inventory can speed up a claim and ensure you receive the correct amount of compensation.
- Review Your Policy & Coverages: Many homeowners don’t understand their homeowners insurance policy until it’s too late. Check your limits. Make sure you understand the difference between replacement cost and actual cash value coverage.
How Commercial Fire Damage Claims Work
Each year, businesses across the United States lose $3 billion in commercial and industrial property due to fires.
Commercial fire damage claims are similar to residential claims. The main difference is in the value: commercial claims tend to be much costlier. Some businesses lose millions of dollars’ worth of property and inventory during a fire, leading to a longer and more complicated insurance claim.
Many businesses hire public adjusters to help manage complicated commercial claims.
A public adjuster can organize a commercial fire damage insurance claim, speed up the claims process, and ensure you receive the maximum possible amount of compensation. Many public adjusters even specialize in managing commercial property fire damage claims for businesses.
Total Loss Fire Claims
Some fire damage insurance claims are total loss claims.
A total loss claim occurs when the cost of the fire damage exceeds the value of your insurance policy.
If your home experienced $500,000 worth of damage, for example, but you only have $300,000 of insurance coverage, then you’re dealing with a total loss fire damage insurance claim.
Here’s how a total loss claim works:
- If the cost of the fire damage exceeds the value of your policy, then you have a total loss claim.
- Fire damage costs include the cost of repairing or restoring your property to pre-loss condition and the cost of replacing all items inside your home.
- In a total loss claim, the insurer pays up to the limits of your policy. If your policy had $300,000 of coverage, then your insurer would pay you the full $300,000.
- If you have any remaining expenses, then you cover these expenses out of pocket unless you have additional coverages in your policy. These include debris removal, increased cost of construction due to city/county codes and often an inflation guard. You would find this in your policy language.
Many homeowners who experience a total loss are underinsured. They don’t have enough insurance to protect their property and the possessions inside. Review your policy regularly to ensure you’re carrying enough coverage. Otherwise, you could be dangerously underinsured.
How Public Adjusters Help with Fire Damage Insurance Claims
When you hire a public adjuster for your fire damage insurance claim, you’re getting a trusted expert who represents your best interests – not your insurance company’s bottom line.
Some of the ways a public adjuster helps with a fire damage insurance claim include:
- Support your claim from start-to-finish, organizing documentation and communicating with your insurer on your behalf.
- Obtain a fair claim settlement – often much higher than the initial offer.
- Provide expert assistance at every step of the fire damage insurance claim process.
- Negotiate with the insurer on your behalf to obtain the highest possible amount of compensation.
- Manage fire damage restoration and repairs from start to finish to ensure your property is restored to pre-loss condition.
- Provide a second opinion on home valuation, policy coverage, and repair costs.
- Represent your best interests instead of your insurer’s best interests.
In exchange for providing these services, public adjusters charge a fee – typically between 5% and 25% of the final settlement, based on the adjuster’s experience and the complexity of the claim. This fee is discussed upfront. In most cases, policyholders pay nothing until this final fee, helping the adjuster stay motivated to push for the highest possible payout.
Many of our customers agree: hiring a public adjuster feels like a weight has been lifted off your back. You can relax while letting an expert focus on your fire damage claim.
Fire Insurance Claims Examples
Whether dealing with a total loss claim worth millions or a small kitchen fire worth thousands, we’ve seen it all.
Here are some real-world examples of fire damage insurance claims and how public adjusters could help:
Historic House in Dallas Total Loss Fire Claim
A historic home in Dallas was insured for $421,000 and destroyed by a large fire. It was a total loss – but the homeowner and insurance company disagreed on the amount required to pay.
Although the home was insured for $421,000, the insurer valued the property at $365,000. According to the insurer, they only had to pay $365,000 to cover the actual cash value of the property – the exact value of the property at the time the loss occurred.
The homeowner fought back by hiring a public adjuster. The public adjuster identified features and fixtures in the home that increased the value significantly. Ultimately, the insurer paid the full $421,000 value of the policy, including additional coverage for debris removal, damaged landscaping, and other expenses, thanks in part to the public adjuster’s work.
Commercial Fire Claim At A Lumber Company in Tennessee
A lumber company in Tennessee experienced a fire that led to the loss of $5 million of inventory. The insurer delayed and denied the claim at first, demanding evidence of the $5 million of lost inventory.
After hiring a public adjuster, the lumber company was able to receive the full amount owed for the loss of inventory. The public adjuster also argued for the coverage of moving expenses, as the lumber company needed to adjust operations during the fire damage restoration process. Overall, the lumber company significantly improved its payout by hiring a public adjuster.
House Fire in the Suburbs of San Antonio
A homeowner in suburban San Antonio received a call at work that her house was on fire. An electrical surge had sparked a fire within the kitchen. A neighbor spotted the fire and alerted emergency services quickly, and firefighters stopped damage from spreading to other parts of the home.
The insurance company’s adjuster initially offered a payout of $34,000 to cover the cost of repairing and restoring damage in the kitchen. The homeowner disagreed with that valuation, however, and hired a public adjuster to get added compensation. The public adjuster identified smoke and soot damage throughout the property, ultimately arguing for additional coverage. The overall, final cost of the fire damage insurance claim was close to $70,000, and the homeowner received this amount with help from a public adjuster.
Getting Help With Handling Fire Insurance Claims
Fire insurance claims are among the most common – and most expensive – types of homeowners insurance claims.
Most homeowners aren’t experts at fire damage insurance claims. If you’re lucky, you may only have experience with one fire damage insurance claim in your life.
Fortunately, we are fire claim experts. Contact ClaimsMate today for expert assistance with your fire damage insurance claim.
ClaimsMate’s public adjusters have decades of proven expertise helping homeowners and business owners maximize compensation for fire damage insurance claims.
Stephanie is a property insurance claim expert with over 20 years of experience working as an insurance adjuster, expert witness, appraiser and umpire. She is passionate about sharing her expertise, knowledge, tips and training to help both property owners and Public Adjusters in their pursuit of effectively managing claims and recovering the claim settlement they deserve after a loss.
