Tips for those whose houses did not burn but were damaged
1. Even though my house did not burn in 1993, the houses across the street and next door did. I ended up with $23,000 in damage.
2. Toxic fumes and ash invaded the house. If your insurance covers it, insist on a chemical wipe cleanup of everything in the house. (I’m still finding ash 25 years later.) It cost $6,000 in 1993.
3. Get new mattresses—the ones you have are probably filled with toxic matter. Throw out food not in sealed containers.
4. Even your wine collection could be damaged from the heat. I hired an “expert” to randomly sample my wines (I helped), and he determined that there was some damage, and I got a 30 percent “reduction in value” payment from my insurer.
5. Clothing left in house needs to be thoroughly cleaned, and your insurer should pay for it.
6. Remember that insurer’s claims adjuster is not there to help, but to pay as little as possible. Don’t agree to a lump sum payment for everything–wait until all damage has been assessed.
Tips for homeowners whose homes burned to the ground
1. Contents: If you took a video of everything in your house before the fire, and still have it, that is the gold standard for proof of what contents you lost.
a. Failing that, check your phone for videos or photographs of each room in the house, ask relatives or friends for photographs, etc.
b. Make a list of everything you have lost in each room in the house, the date purchased and its estimated value.
c. Artwork and jewelry may be special cases. Unless you have listed them in a special endorsement to your insurance policy, there may be a limit to what you can recover for each item.
2. What type of homeowners insurance policy do you have?
a. Fair Plan—special, limited coverage. Get a representative who knows how to negotiate with Fair Plan representatives.
b. Standard insurance coverage—may be forced to take a reduced amount due to depreciation.
c. Replacement value coverage—supposedly covers everything, but may not cover rebuild costs, which have increased since you bought the house due to changes in building codes, such as septic systems, roofs and solar.
d. Full replacement cost coverage—“stick for stick.” The insurance company will rebuild your home exactly as it was before the fire with no depreciation—all new construction, whatever is required to replace what you had. If you have this coverage, you are very lucky, but there still may be code upgrade issues.
3. Loss of use: Many policies provide for your living expenses while you are without a house or forced to move out because of fire damage. There may be a daily limit or a total loss of use limit. Check the policy carefully. This is a major area of negotiation.
4. Negotiation tactics:
a. Do you want to rebuild your house on site or are you willing to take a lump sum settlement, deed your remaining land to the insurer and buy a house elsewhere? (If you have no mortgage)
b. What is the position of your mortgage holder (if you have one)? Do you have mortgage insurance that will pay it off?
c. Get yourself a lawyer (not me; I am retired) if you are being jerked around by your insurer. In a suit for bad faith, emotional distress damages may also be recoverable from the insurer.
5. Future plans for those whose houses were not destroyed:
a. Create a video of everything inside your house and put it in your safe deposit box. Date it.
b. Create a “short list” of important things to take with you if you have 15 minutes to leave the house, such as family photos, ancestral items and things that cannot be replaced.
c. Create a “longer list” of important things to take if you have several hours before you have to leave.
d. Put the lists in a sealed envelope and have it available if needed.