Damage to your home or property is always a stressful event. The process of filing an insurance claim, managing the restoration work and repairing your home is often more than a homeowner can manage alone. The whole process can be a very confusing, time consuming and a challenging situation. That is why Madison Ave Construction is here to represent your best interest on every aspect of the claim and work for you to get your home back to its pre-loss condition, or better.
While we will manage the entire restoration process for you, it is also important that you understand each step.
We’ve compiled a list of Frequently Asked Questions we often hear clients ask us. And as always, we are only a phone call away if any other questions or concerns may arise during the restoration process.
Q: ARE YOU LICENSED AND INSURED?
A: We are licensed contractors and insured. More importantly, we stand behind our work and will work with you until your home is put back together again. We do not rely on our insurance to do the right thing by you.
Q: DO I HAVE TO USE THE RESTORATION COMPANY RECOMMENDED BY MY INSURANCE COMPANY?
A: Some insurance companies will recommend a restoration company and others will not. You always have the right to choose who you want to do the work. When you hire Madison Ave Construction as your restoration company, we are here to represent your best interest on every aspect of the claim.
Q: WHAT HAPPENS IF ADDITIONAL DAMAGE IS FOUND AFTER REPAIRS ARE STARTED?
A: If we find additional damage during the cleaning or rebuilding process, we will notify the insurance company and ask if they want to re-inspect before any further work is done. Sometimes they will send an adjuster, other times they will ask us to take pictures to send to them. Normally we will not continue work until the repair or replacement of the additional damage is approved by your insurance company.
Q: WHAT IF I WANT TO DO SOME REMODELING WHILE MY HOME IS BEING REPAIRED?
A: Your insurance policy provides payment for the repair or replacement of damaged property with materials and fixtures of “like kind and quality.” Your insurance company will not pay for the increased cost of remodeling or upgrades to kitchens, bathrooms, or other parts of your home. However, we can work with you during the rebuilding process to determine the additional cost according to the work you want done. Payment for any additional work or upgrades would be made directly by you to Madison Ave Construction.
Q: HOW DO I KNOW MY CLAIM IS COVERED BY MY INSURANCE?
A: No two claims or insurance policies are the same. We do not know what your insurance company will cover until the claim is submitted. We have many years of experience looking at insurance policies, and we are always glad to answer any questions you may have.
Q: WHO PAYS YOU?
A: We are sometimes asked by clients what they will be getting from the insurance company for their loss. The money paid out by your insurance company is designated solely for the repair or replacement of your home, there is no money due back to you for the work we do.
Q: WHAT IF I DON’T USE THE MONEY I GET TO MAKE REPAIRS?
A: Your insurance company agrees with us to pay a specified amount of money to cover your loss. Rest assured, your company does not allow for “extra money” for your claim. We work very hard on your behalf to get every dollar possible to repair your home, and all the money goes to the repairs.
Unfortunately, we have seen clients receive claim checks and then pay off student loans, go on vacation, buy a car, or make other purchases because they believe “it is my money.” That can put you in dangerous territory with your insurance company. Converting claim money to personal use can be considered illegal in some cases. It can also cause your insurance company to deny future claims or drop your insurance altogether. Your homeowner’s insurance policy is very specific on your responsibilities for receiving payment on your claim.
Q: WHAT IS THE DIFFERENCE BETWEEN AN INSURANCE CLAIM VS. HOME REMODELING?
A: There is often confusion on how much money is being allowed for the repair of insurance claims. An insurance estimate is designed to put your home back to its pre-loss condition. Obviously, what is repaired or replaced will be new, but your policy only allows for “like kind and quality,” not a substantial improvement.
Home remodeling is different, and you choose to make improvements to your home, not just keep it the same as before work is done. If you have damaged Formica or Corian kitchen countertops, please don’t expect the insurance company to replace them with granite.
If you do want to make improvements while you repair, we can do that. You will be responsible for the difference in cost. Please talk to your project manager if you want to make changes while we start your work.
Q: WHAT IS INCLUDED IN CLAIM PAYMENTS?
A: Your insurance policy provides coverage for your home, detached structures, your personal property and the cost to live elsewhere if your home is uninhabitable. No two insurance companies handle claim payments the same way. Some companies will make separate payments for the loss mitigation (cleaning up the damage), personal property that is being replaced and the cost to rebuild your home. This may be confusing at times, and we will make sure each check received goes to the appropriate expense.
Q: WHAT IS DEPRECIATION?
A: In the course of estimating the cost of the repairs to your home, the insurance company will set aside 8 – 10% of the total estimate as “depreciation.” The money held back comes out of the total amount due to Madison Ave Construction for repairing your home. The insurance company holds this money back with the understanding that they will release it to you once all of the repairs they are paying for have been completed. It is their way of making sure the money they are providing for the repair of your home is being used for that purpose.
Once all the repairs to your home are complete, we submit pictures and a signed “Certificate of Completion” to your insurance company. At this time, the money held for depreciation is released to you and can then be used to pay Madison Ave Construction for the balance of the completed repair contract. The Certificate also prevents the insurance company from denying future claims because prior damage has not been repaired.
Q: DO I HAVE TO PAY MY DEDUCTIBLE?
A: The answer is yes. Every homeowner insurance policy has a deductible. The deductible amount is part of the approved claim payment that goes toward the repair of your home. It is your responsibility to pay the deductible to Madison Ave Construction once all the repairs are completed. The deductible can be a flat amount of money i.e., $1,000 per loss, or it can be a percent of your home’s total replacement cost. This type of deductible often applies to hurricane damage. The deductible is the amount of money you are responsible for in a loss.
If the total cost to rebuild your home is $20,000 and your deductible is $1,000, the insurance company will pay Madison Ave Construction $19,000 to rebuild your home, you would be responsible for the remaining $1,000 to finish the work. We are not allowed by law to waive your deductible. Many insurance companies are now asking for copies of your canceled check payable to us to ensure the deductible has been paid.