EXPLAINER: Dozens of Canterbury households have seen floodwater make an unwelcome entrance into their homes, and sometimes cars.
Two to three months’ worth of rain has pelted Canterbury in past few days, causing significant and extensive flooding.
Once the water recedes, households face the ordeal of the tidy-up and restoration of their homes.
Insurance and Financial Services Ombudsman Karen Stevens has tips for people facing the task of setting their homes to rights.
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They involve policyholders doing all they can to document the damage to their homes and chattels to help ensure insurance claims go as smoothly as possible.
Stevens said people whose homes and property had been damaged in the flooding should record the damage before cleaning up.
“It’s only natural to want to start the clean-up process immediately,” Stevens said.
“However, we urge people to take a moment and contact their insurers, and to record the damage first,” she said.
“Take photos or videos of your house and any damaged belongings. Make lists of all the damaged items before you dispose of anything,” she said.
Evidence gathered this way can make it easier for people to prove their claims, and it established their ownership of the assets they were claiming for damage to.
DON’T CHUCK AWAY DAMAGED STUFF
There was a natural tendency to immediately dispose of damaged items, Stevens said.
“We’ve dealt with a number of insurance-related complaints over the years where people have rolled up their sleeves and got in straight away, cleaning up and throwing away items.
“Later in the insurance claims process, this can lead to problems when proving damage,” she said.
She recalled one case in which a homeowner threw away damaged items, and made a big list of everything that had been disposed of.
“The insurer was in their rights to say, ‘You have got to give us something better than the list’,” Steven said.
The onus of proving a loss falls on the shoulders of the policyholder, which includes proving they actually owned the stuff they are claiming for.
CHECK IN WITH YOUR INSURER
“Ask what you need for your claim, and ask your insurer to confirm this in writing,” Stevens said.
“Ensure you know what you are and are not covered for. If you don’t understand, ask questions,” she said.
One of the shocks people faced after an event like a flood or burglary was finding out that not all their damaged or stolen stuff was covered on a “new for old” replacement basis, but instead for its “indemnity value, Stevens said.
Indemnity value was an item’s secondhand value, the moment before it was damaged.
This could mean a policyholder received less money to replace their damaged items, than they would need to go out and buy new replacements for them.
“A lot of people expect if they have a ‘replacement’ policy, that everything will be replaced at the value they would have to pay to get a new replacement,” Stevens said.
She also recommended people read their insurance policies, because they might find they were covered for losses they did not realise.
Insurers have their policy documents posted on their websites.
“If you are unable to get back into your home, contact your insurer to ask about temporary accommodation cover, under either your house or contents policies,” Stevens said.
People were expected to do necessary repairs to prevent further losses for their insurer, said Stevens.
But they should not make “non-essential” repairs without talking to their insurer first.
Insurers might take a different view of things homeowners considered to be reasonable actions, such as ripping up a sodden carpet, she said.
STICK TO THE STRICT TRUTH
Though it was rare, people sometimes fabricated evidence, said Stevens.
This was a very silly thing to do, she said, and it could lead to their entire claim being “avoided” by their insurer.
She recalled instances of people creating proof of ownership of items in a bid to make their claims process go more smoothly.
“We have often struck cases where people create lists (of stolen, or damaged items), but have no proof of purchase, and they take the really silly step of falsifying an invoice,” Stevens said.