Insurance Claims – Get an improvement Payment!
Insurance claim improvement payments are not widely known by people who file claims. Often, when an insured has a loss of meaningful size, such as a flood, tornado, wildfire, hurricane loss or a big water damage loss, an improvement payment of a portion of the expected settlement is issued by the insurance company. This situation also happens regularly when a business has a loss and needs money up front.
It is a customary and widely accepted practice for the insurance company to issue an improvement payment in this kind of example. Be aware that there’s nothing in the standard character insurance policy that deals with advances. It is usually just a courtesy that the insurance company extends to their policyholder.
However, they don’t usually offer to do it. You have to request the improvement.
Here’s an example. Joe Smith’s house is hit by lightning, and a fire damages most of the house. Joe’s policy has Building limits of $100,000, Contents limits of $50,000, ALE limits of $20,000. The house can be repaired for $70,000, which is less than the policy limits. However, the adjuster expects that the Contents loss will go beyond the policy limits of $50,000, and the ALE loss will be $15,000. The adjuster sends in his first report to the insurance company, and tells them to expect the loss to be approximately $135,000 on these three parts of coverage.
The insurance company could easily issue an initial improvement payment of $25,000 to $35,000 for Contents and ALE, and $40,000 to $50,000 for the Dwelling loss.
So, what do you do if your Contents are damaged and you need the most basic things, like a change of clothes and shoes? What if you need to have a contractor obtain the building and put tarps on the roof to keep further rain out of the building? Most people do not have tens of thousands of dollars just lying in their bank accounts that could be used to begin repairs, or begin replacing personal character. That’s when the insurance company issues an improvement.
It’s best to make your request in writing. already if it’s just a hand-written letter, it’s best if it’s in writing. Write or kind your request, keep a copy for your records, and give the copy to your adjuster. It’s also a good idea to send a duplicate copy to the claims department of your insurance company. Send it by overnight courier or certified mail. NEVER rely on the adjuster to ask for an improvement on your behalf. He might get delayed with other work and it could be days before he asks. DO IT YOURSELF.
Take control of your claim, my friend! Make an EARLY request in the claims course of action for your improvement payment!