The Importance of Reporting Claims Promptly
With the Atlantic hurricane season underway, the increasing threat of wildfire, and the growing number of hail and severe weather events across the country, it is critical for self-storage property owners to understand the important role timing can play in resolving insurance claims. Delayed claims reporting may result in an extended investigation, delays in resolving the claim, and possibly a more costly outcome for the policyholder.
Once the severe weather or other event has passed and you have surveyed the damage at your facility, it’s time start the claims process. Keep in mind that you can report a claim to your insurance agent or directly to the carrier, but only report each claim once. If you work with an insurance agent, it is a good idea to report the claim directly to them. In the event that you have kept a record of the names, addresses, phone numbers, policy numbers, and other identifying information concerning your various carriers, you will have the necessary information at your fingertips. Claim reporting information should include the following:
· Your business name, address, and phone number
· The name and phone number of the person to be contacted by the insurance company
· All contact information for the insured and/or the insured’s representatives
· Policy number
· Date, time, and location of the loss
· A brief description of the damage (if multiple buildings are damaged, specify which buildings are damaged with specific addresses for each)
Delays in reporting a claim to your insurance agent or carrier can complicate the process in several ways. The longer it takes for the carrier to be notified of a claim, the longer it will take for the claim to be resolved. In addition, delays can make the investigation process more difficult as evidence of property damage may degrade or disappear over time. Witnesses to a slip-and-fall-event or other incident resulting in a claim may forget details or may leave the area and become difficult to interview.
In the case of claims for property damage, the cost of repairs and reconstruction may increase over time, resulting in higher out-of-pocket costs for the policyholder. As the price of construction materials and labor continue their upward trend, this becomes a particular concern. A recent industry report indicates that total reconstruction costs, including materials and labor, increased nearly 5 percent from July 2019 to July 2020 with increases shown in all states. For materials, carpet had the highest increase at over 5 percent, and drywall installer/finisher costs had the highest increase for labor at over 13 percent. Steel prices are projected to continue to rise in 2021.
Providing detailed information in a timely manner gives your insurance carrier's claims adjusters a head start on processing and resolving the claim, which can translate into a quicker and more productive resolution. NOTE: In the event that you receive notice of possible litigation or retain an attorney, it is critical that you report this information to your insurance agent or carrier IMMEDIATELY. Giving claim professionals the maximum time available to respond is crucial to an effective resolution.