Natural disasters and extreme weather events have become more frequent in recent years, causing unexpected destruction and property damage. When such disasters occur, homeowners are left with devastation and a loss of how to put the pieces back together.
One of the first places where a bottleneck in the claims process can occur is the delay in documenting a contents loss, which can be caused by being overwhelmed or procrastination.
Allowing time to go by without adequately documenting a contents loss only creates more problems for both the insured and claims staff.
To avoid delays in the claims process, claims personnel and vendor partners can assist insureds in documenting their contents loss list. Any delay at the onset of a claim will only prolong recovery and any supplemental payment. Losses that occur as a result of a catastrophe can easily cause a claim to go sideways, especially when there are several losses resulting from a single cause.
After a catastrophe, adjusters and claims departments are inundated with disaster-related claims, leaving them with little time to review contents claims to distinguish content age or value. An overwhelmed claims department coupled with confused insureds can be a recipe for loss of customer confidence.
Experienced contents valuation providers have deep product knowledge that allows them to efficiently resolve contents claims by valuing each item on a content inventory with current like, kind, and quality (LKQ); taking pains to accurately estimate contents losses.
Using inventory software, a contents list can be built immediately on site. The technology allows LKQ or replacement cost to be immediately applied, leading to on-the-spot settlement valuations that can be emailed to the adjuster in real-time.
Scenarios that Slow Settlement of Contents Claims
If the policyholder is a fine art or antique collector, trying to review the necessary documentation, like proof of ownership, the bill of sale, and the certificate of authenticity to determine an art collection’s value, can slow the claims process to a crawl. Valuation can be tricky, especially if an appraisal is necessary.
Hoarding situations present another issue a claims adjuster may not be prepared for. The policyholder will need help with distinguishing personal belongings from those that no longer hold value, such as empty bottles or stacks of old newspapers.
Large losses, involving hundreds or thousands of contents, can also prove cumbersome, causing the claim cycle to lag. Oftentimes requiring extra personnel, an already overworked and potentially understaffed claims department may not be up to the task.
The scenarios above highlight the value of bringing in outside experts that specialize in contents list creation and valuation.
ClaimPlus can provide needed assistance by working with the insured to create a contents inventory list, assisting the adjuster by applying accurate depreciation and valuing contents in an efficient manner.
This allows the adjuster to focus on coverage and what is covered under the policy. At the scene, ClaimPlus can help adjusters manage claims from their desk, allowing more time for claims staff to focus on large and complex losses.
Prompting the insured to review and document their contents loss allows greater efficiency, a benefit to both the claims department and to the policyholder.
With the time-to-valuation cut, contents claims can move to the settlement stage quickly. Because the loss is paid quickly and accurately, the shortened claims cycle leads to a better claims closure ratio, offering an opportunity for the insurance carrier to reduce loss adjustment expenses.
When a contents inventory is completed immediately after a loss, the adjuster can accurately reserve and settle the claim, reducing the likelihood of under or overpayment (“claims leakage”) to the policyholder. When a claim is handled efficiently, a settlement can be issued promptly, affording the insured the opportunity to get back on their feet quickly. This leads to yet another benefit for the carrier — a positive claims resolution equates better customer satisfaction and increased policyholder retention.
