How to advocate for yourself during a home insurance claim
Many Australian families go through difficult circumstances such as their homes being affected by fire, storm, roof, wind and water damage. This is why having a good home and contents insurance policy is so important.
However, when it comes to making a claim, many insurance policy holders report feeling alone, confused and vulnerable.
When insurance claims are large and complex, people making a claim often feel that the process is slow, inefficient and reactive.
It can seem like getting anything to happen requires hours waiting on the phone and being passed from person to person.
After speaking to many Australians in this position, here are our top suggestions for advocating for yourself during an insurance claim.
Read and understand your policy
Not every insurance policy is the same. It is important for you to understand your policy cover.
In your policy document, you will find the total sum insured, as well as rules about what can and cannot be claimed.
You typically pay the “Premium” every year, either as a lump sum, or as monthly payments. This is the amount you pay to remain insured.
Should you need to make a claim, you are required to pay the “Excess” for each claim made, which is a sum you agree to contribute to each insurance claim.
If you need advice about reading and understanding your insurance policy, there are several places you can go for help. We suggest speaking to your insurer at first. From there, you can get independent advice from an insurance advisor, an insurance broker, or an insurance lawyer.
Advocate for yourself
Sometimes in a stressful situation we just want everything to go away, and it can be tempting to want to end the insurance claim process quickly due to the stress of everything you have already gone through.
However, remember that insurance is a business. Businesses have processes that need to be worked through, and this can take time. Your claim is progressing through a pipeline with hundreds of other claims at any time.
In addition, the people you interact with are going to try to resolve your claim at the minimal cost to the insurance company. There is nothing inherently wrong with any of this. It’s not that they don’t care. This is how business operates.
If you want to get the best outcome for your situation, you need to be patient. You need to be willing to make phone calls and wait on hold. You need to be willing to make sure that building works are done correctly, and if there are problems, that they are fixed before the claim is closed.
Even though the process can be long and stressful, people who advocate for themselves fairly and ethically end up being well looked after by insurance companies.
Don’t accept a cash settlement
Most insurers will make an offer to cash settle the claim early in the process. This can seem to be an attractive option to bring closure and move on with your life.
However, in the world of home insurance, accepting a cash settlement is often not a good idea.
In recent years we have seen inflation increase especially in the cost of building materials and labour. The cash settlement amount on offer and the actual cost of completing the works may differ on this basis alone.
Also, when you accept a cash settlement, you are responsible for finding builders and trades to complete the building works. You take on project management responsibility in addition to everything else you do with your time.
If there are further problems with the works completed in the future, you are responsible for chasing the builder for their warranty. You will also likely miss out on some of your entitlements for temporary accommodation during the works.
Conclusion
If you or a loved one has faced difficult circumstances and has made a home insurance claim, remember
- Read and understand the policy
- Advocate for yourself
- Don’t accept a cash settlement
*The information in this article is general in nature and is not personal advice for what to do in the situation of an insurance claim. Before acting on any information, consider the appropriateness of the information provided and seek independent advice from a qualified professional. Link to terms and conditions. *