Insurance Claims Step by Step Process - Part 8

I got some money to my contractor today. We have the siding color picked out which is similar to what we had.  He got the permits pulled for the roof and the siding today.  He is going to start on the property tomorrow, and work on the siding, roofing, wraps, garage door, exterior window painting this week and should have most of it done by the weekend. He is hoping to finish by late Monday or Tuesday at which time he will fax the claims department to tell them that he is done so that they can mail out the remaining “depreciated” amount of what’s owed.

I have to really rush on it since we are trying to close by the end of the month, plus what I’d like to do is just finish it by the weekend and close the property and then wait for the remaining check to come by mail, but what will happen is I’ll get another check which will be made out to the lender, which I’d have to mail in and have endorsed by them, which they probably won’t endorse since I will have closed and paid off their loan, plus their would be a new buyer, so that would complicate things.  Plus the contractors are going to have to sign lien waivers, and even the subcontractors will need to sign lien waivers.  We have to think ahead on properties like this for the closing date.  I will update everyone as the process moves on.  I got my 2nd insurance check in to the lender yesterday by mail and hope to have that endorsed and back anytime.

Sept. 10th

Rather then start a new 9th post on the insurance claim I’ll just end with this. It’s been probably another 5 weeks after this last post at least. I had to receive up to 5 checks.  2 of the last 3 checks were smaller and I didn’t have the lender named on them, so that made it easier for depositing.  We are getting ready to close on Friday and I got all of the lien waivers from the contractor and I paid them in full.   It took a couple of adjusters, many months, 5 checks, and many many hours, but I finally got all new siding, all new roofing.  I could probably write a short e-book on the entire process, but all I can say is never give up.  Keep on the insurance company until it’s done. Take the time to coordinate everything.

Insurance Claims Step by Step Process - Part 6

It’s been 3 weeks since my last post, and the process had not been going smoothly at all, it was much more work than I planned on.  The insurance company just didn’t want to pay for the siding.  This past 3 weeks has been very long, let me try to explain what has happened.  The last post I wrote I had the check mailed to me right away from the lender, endorsed, and I was able to deposit it, that was one hassle that I got over.  The problem for the last 3 weeks was convincing the insurance company to pay up money for the siding.   Let me walk you through some of this.  The adjuster took a piece of my siding and said he found a match with a local company.  We have been talking back and forth with the contractor the insurance companies claim department, etc and telling them that this local siding company has not enough left to do the entire place and it doesn’t match.  Let me get into why this claim is so unique.  This is a twinhome. The neighbors insurance company instantly was ready to pay for new siding, my company wanted to repair a few pieces.  The problem is that in their mind their was enough to fix some of my cracked pieces, that’s all they were concerned about.  My problem is I said even if it did match, let’s say my pieces get fixed, obviously the neighbor has to choose a color of siding also, their isn’t enough to go around to do both sides. We went back and forth for 3 weeks, and got nowhere. I talk to the claims department by phone a couple of times, his supervisor decided not to pay a couple of weeks ago, I was not happy with him, he could tell.  I talk to my insurance agent of many years, he was coming up with reasons to only pay for the broken pieces.   The contractor had some very serious talks with the claims department and he wasn’t getting anywhere. No matter how many times we told them their just isn’t enough siding in the country they stalled and didn’t seem to care, in their mind they gave us a little money already for everything else.  Here is the part where we started to make progress after 2 1/2 weeks.  We had the contractor get a piece of the siding from the local company , that supposedly had a match.  He then held it up against my current siding and took a photo.  At this point we found it to be pretty obvious that it wasn’t going to be a match based on the photo.  The contractor emailed his invoice and the photos to the claims department at the insurance company to show that it didn’t match and that he needed a check to cover the invoice.   I asked the contractor to email me the photo.  I then emailed the claims department the photo also and said this is not a match and I would like someone to rush out and take a look at this, this is not acceptable , and I wrote some other things in a paragraph to them.   From there, within about 72 hours they were now sending out a second adjuster to come out to the house. Keep in mind it had been about 5 weeks since the last adjuster was out there.  The 2nd adjuster made it out there yesterday, my contractor was out there.   The contractor put the adjuster on the phone and she basically said about 2 sentences, “we won’t find a piece big enough for this, so we’ll just send you a check then, is it the same address.”  I couldn’t believe after like 5-6 weeks that she got it, and no one else did, all because we just showed them a non matching piece, and had a 2nd adjuster.  I had talked to other contractors in the business and basically what they have told me is you have to just keep at it, they won’t want to pay, you just have to be persistant, it takes time.   Looking back, I have agreement to send this check and get started now on the job.  It took about 6 weeks at a minimum, had we not been persistent, it could have taken 3-4 months.  Think about it, how quickly would an insurance company want to hand over money, they are going to make it challenging.   Keep persistent, hire a contractor that knows what they are doing, and just keep on it every day.

Insurance Claims Step by Step Process - Part  5

I have the process moving along now, and I took the check and overnighted it about 2 days ago.  Here is what I had to do to speed things up.  I went to the post office, did the overnight of the check and included an “overnight envelope” to the insurance department of the lender.  From there I also included my check “not endorsed”  and asked them to endorse it.  This particular lender said that since the check was under $10,000 and my account was current they would endorse it and send it back to me.  You have to be under the lenders $ threshold, and be current on payments.  I just called the insurance department at the lender today to verify that they got it, and they said they did and endorsed it and mailed it back out.  This is great news.  I heard that the contractor thought the siding didn’t match, so my contractor is going to follow up with the insurance adjuster to let them know their are a few matching pieces possibly left, but it’s discontinued and we need to continue with the claim and get new siding or both sides (twin homes remember).  So I should have my check in the next few days, and I will get the roof job started and siding when I get a chance.  I will keep you updated as things progress.

Insurance Claims Step by Step Process - Part  4

I have been on the phone today with the lender and contractor and went over some things.  The lastest update is that I got a supervisor in the insurance department with the lender and they have a way for me to send in the adjusters inspection info and the check and they will endorse it and mail it back to me.  So tomorrow I will be over nighting the check, they will process it for 2-3 days and send it right back to me provided I send them a self-addressed envelope.  This is good news.  The contractor is in contact with the adjuster to talk about the siding match and they are going to need to have the siding shipped in from another state to compare it.  If it still doesn’t match like they say, then we will have to go through a process of disputing it I suppose.   For now we are planning on getting the roof done, wraps, gutters, and siding to match and parts replaced.  I will have a check in the mail , I’ll get that back, get it to the contractor and get him started on the job ASAP.

Closing is coming up soon, so I had to talk to the title company today, see my seller’s closing checklist post

Insurance Claims Step by Step Process - Part 3

of the Insurance claim on this property.  This is going to be more work than I thought.  When I last posted I had an insurance check and was ready to go get it endorsed, deposit the check and get started on this project.  I should have known it wouldn’t be that easy.   The insurance company said they found a match. They are suppose to send me a report in the mail to show me where they found the siding match.  It’s now Monday and I haven’t got that in the mail yet.  I am starting to realize that insurance claims much like the short sale process takes a lot of time.   I felt like I was ready to wrap this up, and now I am realizing it’s just getting going.  Here is the dilemma:  The check is made out to the ABC lender and made out in my name.  I figured I’d get their endorsement(signature or stamp) on the back of the check, and they’d mail it back and I’d just deposit it and write a check to the contractor to get started on the roof and siding.  If only it was that easy.

Insurance Claims Lender Part

The lender said, “you send in the check endorsed, send in your insurance claim inspection paperwork, send back our insurance paperwork package with contractor info, etc and we’ll deposit the money on our end and pay you 1/3 upfront, and then when you are 95-100% done with everything pay the remaining left due to be paid in full.  The problem with this is that it takes so long to do everything by mail and to wait on checks, etc.  What incentive does anyone have to move quickly except for me?   I can save some time by receiving faxes on the current items I am waiting for by mail then faxing them back, but I still have to overnight the check, get them a pre-paid envelope so they’ll send it back right away, but they still have to wait on the processing of that check.   Once I get that 1/3 back from them, I can pay the contractor with that money and tell him to get started.  Let’s analyze this situation now, why it becomes a dilemma.   You see the insurance company likes to do what they call call “depreciate” the parts of your house, such as siding, roofing, etc.  So if it’s a 10 year old roof, and most roofs are 20 year roofs, than they consider it 50% depreciated.  I can’t say every insurance company does it this way, it’s just my experience.   Basically the insurance company comes up with a total claim and total replacement cost if you have that type of insurance.   They “less out” (subtract) that depreciated % out from your total claim to be paid at completion.   Let’s say I started with a $7800 total claim and got paid $6000 for now.  Take that $6000 check and send it into the lender where they will return a check for $2000 (1/3 of total loss). Let’s say that actual cost of labor and supplies for the contractor is the $7800 out of pocket for materials, sub-contractors and time(profit).  That means $2000 is paid up front out of $7800.  Did you see how that’s just over 25% of the total loss and cost?  That’s not even enough money to cover materials, or shingles on the job.  Herein lies the problem.

Why would a lender move quickly, they don’t seem to move that fast.  Why would the insurance company move quickly, they have to pay money, who is quick to pay money?   The contractor’s situation is they are pretty busy fixing houses, and collecting money and waiting on insurance money takes forever, so a contractor isn’t eager to put up their own time or extra money upfront waiting on the lenders and the process.  If they have enough jobs going on, it can really make money tight with that much money going out and the waiting game.  So it comes down to the homeowner going through the work.  What to know the added situation?  It’s a twinhome.  The other owner’s insurance company was much more easy to work with on getting the siding covered, but he has to do what I do, and I am limited to the same siding, welcome to twinhome ownership!  I’ll let you know how this goes later on if it becomes interesting.  I’ll post later on how this entire process progresses, I’ll I know is I need to move quickly or closing in the next 11 days!  Now imagine if you have to do this on 10 rental properties, think of the time investment involved.