Koyal Group Training Services: Insurance claims big part of storm aftermath

Even though the severe thunderstorms that bulldozed parts of Mississippi departed days ago, those with destroyed or damaged property will spend weeks, maybe months, looking to replace or be reimbursed for what they lost.

Representatives of private insurers and the Mississippi Insurance Department have been on the streets in the state’s hardest-hit areas this week, looking to help those with damaged or destroyed homes, automobiles and other property. State Insurance Commissioner Mike Chaney said insured losses could reach $100 million, and there could be a comparable amount of uninsured losses, too.

State officials estimate more than 870 homes were destroyed or heavily damaged statewide, and Chaney says there’s extensive damage to commercial buildings, especially in Tupelo. More than 2,000 claims have been filed statewide so far, and that number likely will grow.

But there are also many structures that suffered lesser damage, and State Farm spokesman Roszell Gadson said people first need to inspect the extent of their damage to see if a claim is worth pursuing. “If you have a $1,000 or $2,000 deductible and you have a broken window that’s going to cost only several hundred dollars to replace, you might not want to file a claim,” he said.

Policies vary on what they cover, which Gadson says is especially important because many carry strict coverage limits on higher-end household/personal items, like furs, firearms and jewelry.

When someone may hear back from an adjustor about a claim that has been filed varies, too, he said, since priority typically is given to those who have lost their homes and have nowhere else to stay after natural disasters on the scale of Monday’s tornadoes.

Insurance professionals say policyholders have plenty to do ahead of their adjustors’ visits, such as making temporary repairs to holes in roofing or windows, securing any loose outdoor objects to prevent further damage and documenting what’s been damaged, including working in the date on a newspaper or other dated item to provide a specific time and day as to when the damage was recorded or photographed. Insurers generally keep backup policyholder information in their networks in the event of a homeowner losing important paper-based documentation in a storm.

Chaney says people need to be clear on what they can be fully compensated for and what they can’t. They typically can have claims fully paid, for example, if a storm caused a tree to fall on their house and damage it. If that tree falls in someone’s yard but doesn’t damage any property, an insurer may not fully pay out a claim for that tree to be removed, he said.

Wednesday’s declaration of a federal disaster area in seven Mississippi counties means homeowners and business owners could be eligible for Small Business Administration disaster loans that can help them rebuild. The loans are available in amounts of up to $2 million each. Interest can range from an average of 2.5 percent to 4 percent.

Those who qualify must demonstrate a good-faith ability to repay, and collateral is required in some cases, says SBA spokesman Michael Lampton, although the repayment period can be stretched to 30 years for those who need the time to make full payments.

“Their situations are different, but we do check to see if they have the ability to repay,” he said.

Woodmen of the World Life Insurance Society is offering disaster benefits to those of its 27,000 Mississippi members who suffered property damage or loss of at least $10,000. The benefit amounts range from $100 to $500, or one percent of the damage dollar amount. Members must submit applications within one year of the date of loss, the insurer says.