Monday, July 25, 2011

Insurance and The Recovery Process

WARNING: Long and possibly boring post ahead with little to no pictures :)  But very informative! There, you have been warned!

We got some good news over the weekend regarding our home repairsFinally!!!! Since getting this news, I really wanted to shed some light on what we have been going through and what the recovery process with insurance is like. Also, this is all about/for our house- which is the whole reason we blog in the first place. I know this might be a boring post, but I like to write about our experiences with our home, good or bad (this being more on the bad side). We have learned a lot going through this process and I hope that writing about it can help someone else that goes through a similar situation.  Whether this post is to simply be used as a  guide or to help others dealing with the stress of home repairs to be able to read about someone else that has gone through it, knowing it will get better.

Just in case you aren’t up to speed on what the heck I am talking about, here is a short recap with links to posts that tell more detail:
On May 22nd an F2 tornado came through North Minneapolis. Thankfully Alex, myself, our 2 pups and most of our neighbors were safe. The tornado sent part of our large Silver Maple Tree through our roof and into our Guest Room- this was our biggest problem. There was a lot of other damage to our home’s exterior, our garage, and our property.  The neighborhood as a whole was a complete mess, but in a matter of weeks things were getting cleaned up and life slowly got back to normal- other than dealing with insurance and contractors.
Having a tree in your house isn't a good feeling at all

So let’s get into our experience with insurance from the beginning to where we are at today. Keep in mind this is all my own account of our experience and my own advice (I am no expert). Now, here we go…

After the tornado came through and we were able to take a look at what happened to our house and property then called our insurer’s 800 number to file a claim. If you don’t know the 800 number you can always call your insurance agent to get the number. Here is where I have advice to give: make sure you know the exact location of your insurance policy! You will want to review your coverage. When we called to get our claim # we gave them a brief summary of the damage we were dealing with. My assumption is that they try to gauge how quickly they need to get an adjuster out to see your home- say if our whole house was missing I think they would have been out a lot sooner. After giving them the information they needed, they gave us our claim number and said a field adjuster would call us to give us a time that they would come out to assess the damages. We inquired about a hotel since we were without power but they couldn’t tell us if we would be reimbursed since our house was still livable. So we decided to stick it out in our house.

With the amount of homes and people affected by the tornado we knew it would be a while until we saw an adjuster at our house even with their Catastrophe Response Team. The next thing to do was start cleaning and securing our property from further damage. When reviewing our policy we found that any trees that fell on our house were covered for removal but not the trees that fell on our property- so we were responsible for cleaning up and removing the giant pine tree that fell and the mega uprooted stump it left behind as an out of pocket expense (check out how we got rid of it the DIY way in this post and this post).  We had a crew come out to remove the tree from our roof (read details on that in this post).

After a couple days of clean up we got a call from our field adjuster giving us a day and time that he would be out to see us. In the meantime we still were cleaning up and were searching for a contractor that we felt comfortable with. After a weather related disaster like a tornado rolls through, contractors come out by the masses looking for business and they will tell you anything to get you to sign with them right away- don’t ever sign with anyone! The contractors looking for a quick signature just want to secure you into a contract that guarantees them some amount of money- whether or not you work with them in the end. So be careful and never sign anything! A good contractor will come out to meet with the adjuster and go over damages together, no contacts needed.

We ended up getting connected with a great contractor through one of my co-workers (thanks Andrea!). After meeting with this contractor he informed us of the process ahead with our insurance as well as several steps that have to happen before construction (estimates, permits, environmental testing)- all things we were unaware of, kind of scary, but I liked that he gave it to us pretty straightforward. He also sent someone up to further secure our tarp since he knew it would be a while until any work could start. Again, he didn’t make us sign anything and he said he would be out to meet with the adjuster to go over the damages and write up an estimate for repairs.

Five days after the tornado our field adjuster arrived to review damages to write up an estimate for a claim payment. Our contractor was present and they reviewed everything together to make sure they were including the same items in their estimates. Alex and I observed them as they went over damages just to understand a little more about what needed to be fixed and how. After they were done our insurance adjuster said our recovery packet would be mailed as soon as he finished the estimate. Our contractor informed us that he would call in a few days to let us know when his estimate would be ready.

A few days later our insurance recovery packet arrived in the mail which included an estimate with a list of items to be repaired and our claim check. Just as an FYI- most insurance companies will send you an initial check for the actual cash value (ACV) of what was damaged (less depreciation). Once all repairs are complete you will get a second check for the Replacement Cost Value (RCV) that covers the rest of the amount. These checks are made out to the homeowners and their mortgage lender, unless you own your house outright in which case it is just made out to the homeowner. Get these checks along with the insurance estimate to the bank ASAP! If it is a large amount it can take the bank a few weeks to start releasing the funds and it will go in stages. If your insurance company and your contractor agree on the dollar amount for all the work, they can get work started on your house right away.  You will want to have access to this money to start paying your contractor.

We faxed a copy of the insurance estimate to our contractor so he would know what insurance was covering and could compare to his own estimate. A couple days later our contractor called with a lot of concerns. He stressed that our adjuster had left out a few very specific repairs/ items our home needed due to its age. Like I said before, fixing a home built pre 1970’s is complicated (ours was built in 1924). Back then there were no building codes and scary things like lead and asbestos were normal. Today any home repairs must be up to current codes, so a simple repair could get very complicated and expensive. Our contractor sent us his estimate to send to our insurance adjuster to review the differences. This is where a second field adjuster got assigned to come back out to our house- and things got really sticky.

The second field adjuster came out to our house to meet with us and our contractor roughly 1 month after the tornado (which was around 3 weeks after the 1st adjuster). If an adjuster has to come out a second time, they will send a completely different person to review the first estimate along with our contractors estimate. I am not going to lie here, the second field adjuster was the brother of the first adjuster which I felt was a bit odd when you are hoping to get a fresh perspective. He also came with a very unfriendly and opinionated man that was his boss (although I think his role was to try and ‘spook’ our contractor…seriously)- it was completely bizarre and unprofessional. I’d say this was the only part of the process with our insurance that I was completely unhappy with. Trying to be patient with insurance was one thing (which we did just fine), but when someone comes out to your house to make the process more difficult and argue repairs that are required by the state of Minnesota is quite another. I am thankful our contractor held his ground, stayed calm, and explained our state’s code compliancy when it came to certain repairs that the grumpy insurance manager was arguing with him about. Ugggghhh, I was just speechless and uncomfortable that day, then cried after everyone left. I remember saying to Alex that I thought nothing got resolved that day.

Another few days later our revised recovery packet came- sure enough, NOTHING got resolved. I was pretty upset considering two adjusters came out to see specific damages that needed repair where we weren’t in agreement over costs and it was all overlooked. I just didn’t get it! Our contractor was a bit disappointed as well but reassured us that we would get to where we needed to be with the final dollar amount. He sent us his revised estimate where he had made changes after talking with the adjuster- I felt thankful and confident he was making an honest effort at this point to help us. He informed us that he would be in contact with the desk adjuster to discuss in detail the big differences and would send pictures as documentation.

Alex spoke with the desk adjuster about the differences a little bit, but Alex stressed to them that they just needed to talk to our contractor about it (Alex was also sick to death of talking with insurance). The desk adjuster did suggest a couple times that we get an estimate from a contractor that they have dealt with before, which made us all the more upset. I thought, “What, you mean start over with a whole new contractor just to make this easier on you??!?! Are you NUTS?!?!?” We kept saying no because we really liked who we were working with already and requested that they discuss the repairs with him.

Alex and I were cc’d on a few emails that flew between the two of them. They were scheduled to speak to each other on the phone last Thursday and we anxiously awaited to hear how it went.

Then, late on Friday night we got a message from our desk adjuster saying their conversation went well and he was glad to get us to a resolution and our supplement would arrive in Saturday’s mail. Alex and I thought, well, that sounds good, but we’ll believe it when we see it. The next morning we got a call from our contractor stating the same thing, that everything was squared away and we should be good to go and get work started. To me that sounded more final hearing it from our contractor since that is who we felt more trust with, but then finding the new check in the mail made it all the more real- finally the amount we needed! YAY!!!!

I still have no idea why we couldn’t get there after the second adjusters came out- I mean they were actually at our house. But whatever happened with our contractor and the desk adjuster (along with photos) seemed to do the trick. Although I am really happy that we can start work, I also know that this will likely not be the end of our storm damage woes. As soon as the work starts more damage could be discovered that might need additional work (and money). I really hope we don’t have to ask for supplements ($) as we go, but something tells me that we will since this whole project is quite complicated.

Our final estimate from our contractor had 93 line items in need of repair! Crazy pants! I am probably being very naïve to think that everything is going to be great now that we can start work, but for the first time in 2 months I feel optimistic about our situation with our little Dutch Colonial.
So there you have it, the good, the bad, and the ugly. Like I said, we only hit one really bad bump in the road with the 2nd adjusters, but in large part everyone else we dealt with were very nice. I hope I get to share the name of our contractor soon, but I don’t want to jump the gun until work starts- but he is pretty darn awesome! I know this post was boring, but I just wanted to let you all know what has been going on behind the scenes since we haven’t been doing a whole lot of projects lately.

I really hope once all this action starts I will have lots to share! Have a great week everyone!


  1. oh wow - talk about having to jump through hoops - and more!!
    I'm glad you shared it all here - you just never know when you need to know this stuff (touch wood).
    I do hope things move along smoothly now - fingers all crossed here.
    good luck!!

  2. It's crazy with insurance companies. I am sorry that you and Alex have had to endure so much nonsense. Bless your contractor. You know he will be the best to fix the little d. colonial's broken and aching bones! She'll be in better shape than ever some day soon!

  3. Thanks for sharing. We recently had to open a claim with our homeowner's insurance and I am documenting everything.

  4. I am so sorry. I know what you are going through. We had a total loss with hurricane Ivan, in 2004. It took me nine months to get any money from the insurance company. Soon, your lovely home will be back and better than ever! Good luck! I enjoy your blog!

  5. I actually didn't think this post was boring at all. It sounded scary to me though, insurance to me still feels like such a grown up thing and to this day I don't actually believe that we are grown up enough to deal with things like that :)

    But YAY, I am glad that you are starting work on your house. I'll be crossing my fingers everything goes well and gets finished quickly!


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