The Truth About Settling Property Insurance Claims: Fair vs Correct vs Maximum

In the aftermath of property damage, whether it’s from a hurricane, fire, or broken pipe, dealing with insurance claims can be daunting.

The prevailing thought among many is that if insurance companies are ready to settle, it must be a fair deal.

But there’s more to the story.

Let’s take a look at the nuances of settling claims.

What’s the true meaning of a “fair” settlement? What is a “correct” settlement? Why is going for the maximum amount not always the right focus?

1. Understanding “Fair” Settlements

A fair settlement, in the eyes of many, is a compensation amount that both parties can agree upon. But for homeowners and property owners, is “fair” really fair?

Consider this scenario:

Jane’s home was severely damaged by a hurricane. The initial assessment by the insurance company estimated the damage at $50,000. Without any experience in claims or estimating property damage, Jane assumes this might be fair compensation.

But upon deeper inspection by a public insurance claims adjuster, several damages were overlooked, and the true cost to repair and restore her home was closer to $70,000.

Would the initial $50,000 have been a fair settlement for Jane?

What if the insurance company suggested they split the difference and settle for $60,000? Would that be fair?

Some homeowners might think so.

But in either case, Jane would have been short-changed by not getting enough to pay for the full amount required to restore her property to its original condition.

In our view, that isn’t fair.

2. The Correct Settlement: Making Clients Whole Again

A correct settlement doesn’t mean extracting the maximum possible amount from the insurance company.

It means calculating an accurate and comprehensive estimation of damages to ensure that property owners can fully restore their property to its pre-damage state.

The goal is to “make whole” again, where the compensation covers all legitimate costs of repair and restoration, without leaving the client short-changed or providing them with excess.

At Capital Claims Group, we use our background in roofing and construction to accurately assess damages. Our focus is always on getting the correct settlement to make our clients whole again.

But what about going for the MAXIMUM amount?

Sometimes the maximum amount is also the correct amount.

But not always.

3. Why “Maximum Amount” Isn’t Always Right

Chasing the maximum possible claim amount can sometimes be detrimental for these reasons.

  • Adversarial Relationships: It can lead to an adversarial relationship with the insurance company, which may complicate the process.
  • Ethical Concerns: Seeking an amount far beyond actual damages isn’t ethically right and can be seen as trying to profit from the misfortune.
  • Potential Delays: Overinflated claims may be scrutinized more, leading to longer settlement times.

Instead, the focus should be on accurate assessments and genuine needs.

Empower Yourself with Knowledge

Empowerment in the claims process comes from understanding:

  • Your Policy: Know the ins and outs of your insurance policy. Understand the coverages, limits, and exclusions.
  • Professional Assistance: Consider hiring a public insurance claims adjuster who can provide expert advice, ensure detailed damage assessments, and negotiate on your behalf.
  • Open Communication: Maintain open lines of communication with your insurance company. Regularly update them about findings, repairs, and costs.

In the world of insurance claims, understanding the difference between “fair” and “correct” can be the deciding factor between an insufficient settlement and one that truly covers the damages sustained.

By seeking accurate assessments and focusing on genuine restoration needs, property owners can navigate the claims process with confidence and clarity, ensuring they are made whole once more.

If you’d like some assistance filing your claim, dealing with the paperwork, and negotiating with the insurance company, please contact us for a free consultation and assessment. We would love to help.