If your home is damaged or destroyed in the Los Angeles fires, your toughest challenge may yet lie ahead: getting your insurance company or federal government to pay you the money you're entitled to.
The process is infuriating and disconcerting, and it occurs at an already incredibly stressful moment in life. To make matters worse, the stakes are huge. You can't go wrong.
The New York Times asked experts what to do and what to avoid. Their advice boils down to two points. You don't have to settle for the first thing your insurance company or FEMA offers you. And you don't have to fight them alone.
document everything
Take photos of the damage to your home as soon as possible. Every time you talk to someone from an insurance company or government agency, take notes about the conversation, including who you spoke to, when you spoke, and what the person said.
If you spend money on repairs or supplies while you're away, keep all receipts.
Paying insurance claims is not easy
Insurance companies are the main source of financing for home repairs and reconstruction. Your ability to recover will depend on your ability to obtain the maximum funds allowed by your policy. It's not easy.
“People need to be prepared to fight to protect the terms of their contracts,” said Douglas Heller, insurance director for the Consumer Federation of America.
Heller said there are a few things to keep in mind when you receive an offer from an insurance company. First, ask yourself if the amount offered is enough to repair or rebuild your home. Next, check to see if your contract offers the maximum amount allowed.
If you're offered less money than you think you need and less than your contract allows, you should fight back, says Heller. And the best way to do that is to get professional help.
“The insurance industry is a critical partner in rebuilding after disasters,” David A. Sampson, president and chief executive officer of the Property Casualty Insurance Association of America, which represents insurance companies, said in a statement.
Referring to the California wildfires, Sampson said, “Insurers are planning for large-scale events like this and are committed to providing claim assistance to policyholders as quickly as conditions on the ground allow.” “I am doing so,” he said. “Additional claims staff and resources have been mobilized to help affected families open and process claims as quickly as possible.”
When to call the public adjuster
If you feel that your insurance company is offering you less money than you are contractually entitled to, one option is to call a public adjuster. These are independent professionals whose job it is to assess the damage to your home and negotiate with your insurance company to get you everything your insurance policy allows.
Hurricane Katrina in 2005, Superstorm Sandy in 2012, and last year's wildfires in Lahaina, Maui.
“When you get involved in the matter from day two or three, you can gather the evidence that you know the insurance company needs. ” homeowner or business owner. ”
Use of public adjusters is not free. A portion of the insurance claim, approximately 10%, is usually paid. However, in return, you can often get a larger settlement than you could get on your own.
Your state insurance office may be able to help
You may also consider contacting your state's insurance department. Insurance bureaus usually have a point of contact for consumer complaints. You can call the California Department of Insurance at 1-800-927-4357 or file a consumer complaint online here.
If you file a complaint with your insurance company, be sure to include a copy of the insurance company in your correspondence.
Heller said don't expect state regulators to intervene with insurance companies. The goal is to show the insurance company that you're not going to give up without a fight. Heller said if the state sees a pattern of insurance companies treating people unfairly, it could choose broader interventions, such as instructing insurance companies to change their practices.
When should I call a lawyer?
If you still cannot reach a satisfactory settlement, your core option is to hire a lawyer. But don't press the button right away.
Hiring a lawyer right away “seems belligerent,” Clifford Nkeyasen, a Dallas lawyer suing insurance companies on behalf of claimants, told the New York Times in the fall after Hurricane Helen hit North Carolina. told the paper.
Also, determine how big the gap is between what you want and what the insurance company is offering. “If you think the contents of your home are worth $100,000 and they send you a check for $10,000, it's time to hire a lawyer,” Nkeyasen says.
How do I receive assistance from FEMA?
Another major source of assistance could be the Federal Emergency Management Agency. FEMA assistance programs cannot replace insurance, but they can provide important types of assistance.
Some assistance may arrive quickly. FEMA is offering a one-time $770 payment to disaster survivors. The money is intended to be used for immediate needs, such as food and other supplies for people who have had to leave their homes. This program is a grant, not a loan. Once you receive the $770, you don't have to pay it back.
But that's not the only assistance FEMA provides. The agency has a program called “Individualized Assistance” that provides emergency housing assistance to people affected by disasters. (FEMA also provides many other types of assistance, including hotel stays, car repairs, emergency medical bills, and child care payments.) The Individual Assistance Program provides assistance to victims in Los Angeles County. We are accepting applications from recipients. By the fire.
To find out if you qualify for FEMA's $770 payment or other types of individual assistance, visit www.disasterassistance.gov or call 1-800-621-FEMA (1-800-621- 3362).
It may seem obvious, but be sure to answer all the questions on the application carefully. Many applications are denied because of seemingly common mistakes, such as misspelling a name or entering the wrong Social Security number.
After FEMA receives an application for home repair, the agency sends someone to inspect the damage or use aerial photography. It's important to know that this program is designed to give you the money you need to make your home livable, not the cost of completely repairing it. The maximum amount FEMA can provide for home repairs this year is $43,600.
Don’t be afraid to challenge your FEMA award
Reese May, chief strategy and innovation officer at SBP, a disaster recovery and recovery nonprofit, said many homes were completely destroyed in the fire and were either uninsured or underinsured. If you haven't, you should receive a grant of up to $43,600. It helps survivors navigate FEMA assistance.
May recommends that anyone who falls short of that amount file an appeal.
Even if your home is only partially damaged and your FEMA award is less than $43,600 and doesn't cover what you need, you can still appeal.
My colleague Hannah Dreyer reports that only 3 percent of people whose applications are denied by FEMA appeal. However, even for those whose application has been accepted but who feel they have been paid too little, the benefits of filing an appeal can be significant. “About half of the time, we can double the amount of support available to survivors,” May said.
May noted that the scale of the bushfires could make it even harder than usual for people to seek help. “Survivors must remain vigilant and persistently advocate for themselves,” he said.
You don't have to deal with that appeal yourself. SBP is offering free assistance to homeowners affected by fire who wish to appeal FEMA's ruling. You can contact us at www.sbpusa.org/get-help/. The organization said it is also training local nonprofits to assist with appeals efforts.
What would you do if you lost all your documents in a fire?
If you lose all your documents, including your home title, the process of getting assistance from FEMA will be complicated. A spokesperson for the agency said people without identification can still apply for assistance, but they must obtain alternative identification before receiving assistance. The reason is to prevent fraud.
According to the insurance association, it should become easier to work with insurance companies. Insurance companies usually do not require proof that you own the home before receiving your settlement money. However, if you need to produce a deed, you should be able to obtain a copy from your county government. These documents are usually kept.
What else can I do?
If you can't get enough money from insurance or FEMA to repair your home, you have other options.
Some people receive low-interest loans from the U.S. Small Business Administration. (Contrary to what the agency's name suggests, you don't have to be a small business to qualify.) We've also opened a GoFundMe account and are committed to donating more than $106 million for disaster recovery in 2023. Some companies have collected them, but research shows these campaigns are unfairly advantageous. Wealthier disaster survivors. And many charities are supporting people forced from their homes by disasters.
If a disaster is large enough, Congress may provide additional funding through the U.S. Department of Housing and Urban Development's Disaster Recovery Program. Unlike FEMA aid, that money can often be used to pay for housing reconstruction. But that aid is entirely at the discretion of lawmakers.
