What to Understand about a Total Loss Insurance Claim

A total loss insurance claim is when the insurance company determines that the cost to restore the property is more than the cost of the property itself.  These cases are rare, but they do occur from time-to-time.  One of the most common causes of total loss insurance property claims in South Florida is fire damage, as it can destroy entire properties in the matter of minutes.  Different states have different rules about total loss insurance claims, but this is what you should understand about these types of cases.

How do they determine total losses?

The insurance company will first take their time to ensure that your home is covered by your homeowners’ insurance policy.  Once they determine that the damages are covered, they will begin to evaluate the cost of your damages and lost belongings.  They will send out adjusters and estimators to take care of this part of the process, and they will use receipts, evidence, photos, and documents to help make an accurate estimate.  If the estimated cost of replacements and repairs is more than the value of the home itself, it will be deemed a total loss.

Should you repair or rebuild?

Once your home is deemed a total loss, you may be confused about how to proceed.  Do you rebuild, repair, or move?  Your insurance company will help you make this decision by estimating the costs of each step.  When you have these numbers, you can make the best choice for your situation.

What about replacing your belongings?

In many insurance policies, you will also have personal property coverages that protect any lost or damaged possessions.  If this occurs, your insurance company will cover the cost of replacing these belongings.  However, you need to have Replacement Cost Coverage in order to qualify for this, so be sure to look at your homeowners’ insurance policy before assuming this.

How long does a total loss insurance claim take?

This process can take anywhere from a few days to a few weeks, as it requires more extensive work than many other claims.  More complicated processes that involve lengthy negotiations may take even longer than that.  However, the time it will take to replace and repair your property, belongings, and home may take months or even up to a year.  When you have a total loss insurance claim, you should expect it to take months before your life returns to normal.  

These are a few things that you should understand about total loss insurance claims.  When you are more educated about how to proceed with your property claims in South Florida, you will be able to make the best choices for your lifestyle and needs.  Contact our insurance adjusters if you want help with your claim today.