Dealing with Winter Storm Damage

Normally Covered

The following are losses typically covered by a standard homeowners policy, homeowners unit-owners policy (condominiums and townhomes), and homeowners contents policy (i.e., renters insurance).

• Damage to your home and personal property from burst pipes, which can occur during or after a storm (when pipes start to thaw). Other structures such as a detached garage are also covered for winter storm losses.
• Damage from collapse (the second story of your home's floor collapses due to extensive water damage)
• Debris removal for a covered loss arising from the storm
• A fallen tree that damages your home or blocks your driveway, making it impossible to remove your car
• Temporary repairs made to your home (e.g., a tarp on the roof or a plumber to shut off your water)
• Loss of use expenses—you move out of your home or apartment due to a covered loss and book a hotel room. Such expenses also include additional reasonable expenses for food (e.g., restaurants) and necessary kennel expenses for your pet. But if you leave your home due to lack of power (and there is no damage per se to your home), such extra expenses are not covered.

Possibly Covered

The following loss is one that a homeowners policy may cover.

• Most homeowners forms do not cover spoiled food. There are, however, endorsements (e.g., refrigerated food spoilage) that may be on your policy. Check your declarations page or contact your agent. Sometimes, this coverage is not subject to your deductible.

Not Covered

The following losses are ones that are typically not covered.

• Coverage for winter perils is excluded for outside property such as swimming pools, swimming pool equipment, hot tubs, sprinkler systems, and fences.
• Excess water bills or utility bills arising from the severe winter conditions
• Power failure causing you to leave your home due to extremely cold conditions (no actual damage to your home)
• Loss of water causing you to leave your home (no damage to your home)
• Equipment breakdown (e.g., furnace) arising from the winter storm

Home Warranties

Note that a home warranty may cover equipment breakdown losses arising from this storm. A home warranty may also cover swimming pool losses arising from freezing, depending on the agreement and any optional coverage. Read your home warranty policy closely and examine the exclusions.

Claim Issues and Tips

The February 2021 severe storm damage in many states serves as a stark reminder of the need for homeowners and auto owners to file and subsequently get their claims handled in the most effective way possible. If your damage is slight, filing a homeowners claim is not a good idea. The damage would be under your deductible, and such a filing may be coded as a claim under your policy. Maintaining a pristine claim record may keep your premiums lower in the future.

President Joe Biden recently approved a major disaster declaration for Texas following the winter storm that left residents without power and thousands fighting bursting pipes and water leaks. The declaration allows homeowners and renters in 77 counties that have been designated for individual assistance to apply for disaster assistance through the Federal Emergency Management Agency (FEMA). To apply for assistance online, visit disasterassistance.gov. To do so over the phone, call (800) 621–3362 (TTY: (800) 462–7585). The lines will be in operation 7 days a week, from 8 a.m. to 10 p.m.

IRMI's Top 10 Tips for Filing and Handling Property Claims

The following are the top 10 tips for filing and handling property claims with your insurance company.

1. File your claim promptly. If you have—or suspect that you have—property damage to your home or automobiles, notify your insurance agent as soon as possible with whatever details you can provide (even if you cannot access all of your damaged property). In most cases, your agent will have a toll-free phone number for you to contact your insurance company directly. Make sure the adjuster understands that this call serves as notice of your claim. A follow-up email confirming such notice is also in order. In some cases, a claim can be filed online. Keep copies of email exchanges and make notes of any phone calls—who, where, when, what was discussed, and phone numbers.
2. Perform temporary repairs if possible. Keeping in mind safety and health considerations, try to perform (or have hired) temporary repairs to your home, such as boarding windows and covering roofs. If the house is uninhabitable, make sure the electricity, gas, and water are turned off. Note that temporary repairs are reimbursable as part of your insurance claim.
3. Keep a claim log. Develop and maintain a written log of whom you talked to, his or her title, his or her phone number, the date, action items, and the gist of the discussion. This log is important if you later face problems or delays and need to substantiate your side of the story.
4. Take pictures. Take as many photos and videos as you can to build up your inventory list. Include the brand, model, and serial numbers in the photos when possible. Any documentation regarding the date of purchase and approximate value should also be included in your itemized list. These records will also be helpful for review later when filing taxes and deducting casualty losses that are not reimbursed by your insurance company or are not covered by insurance.
5. Don't forget your additional living expenses. If you have a major water damage loss, the standard homeowners policy provides additional living expenses, which are often 20–30 percent of your dwelling limit. Your insurance company may advance you money to pay for reasonable additional living expenses. Keep track of these expenses, including hotel rooms, extra transportation costs, clothing, personal toiletry items, and restaurant charges. In the event of a major disaster, note that FEMA offers "critical needs assistance." This aid is a one-time $500 payment per eligible household for those with unmet critical and financial needs. Details are available on FEMA's Critical Needs Assistance program website.
6. Check first before discarding property. Don't assume that you can immediately discard damaged items. You often need to show them to your adjuster. If your city requires you to remove them for safety purposes, take photographs of the items beforehand. Take two or three photos showing all sides and capturing any serial or model number affixed to the items plus the extent of the damage.
7. Sign up for text alerts. Many insurance companies offer text alerts to keep you appraised of the status of your claim. Typically, insureds get messages when the claim is first reported, when the estimate is available, and when payments are made.
8. Be prepared to negotiate. In some cases, your repair or replacement estimate may exceed your claim settlement offer. Don't automatically accept the first offer you receive from the adjuster. It may be wise to ask your contractor and adjuster to talk with each other about the repair costs to come up with a solution. The same process applies to working with your auto body shop and auto adjuster concerning damage to your vehicle.
9. Explore options if dissatisfaction arises. First, make sure you are providing all of the information and documents that your insurance company requests in a timely manner. Also, keep your claim log handy when calling to document the results of the call. If you have problems or unreasonable delays, ask to speak to a supervisor or manager. Another option to consider prior to hiring an attorney is contacting the appropriate state department of insurance (DOI) to file a formal complaint (this is free and often helpful). See the insurance complaint sections of your state DOI website for details. In many cases, you can file the complaint online.
10. Find a reputable contractor. Consider the following tips when hiring contractors.
    • Be wary of contractors who solicit business door to door or via cold calls. In addition, contractors should be avoided if they quote a price that will automatically go up the next day or week if the property owner does not accept it immediately.
    • Avoid contractors who promise to handle all of the insurance issues for you and ask you to assign the insurance benefits directly to them.
    • Request recommendations from friends, family members, and business associates for reputable contractors who have performed excellent work for them.
    • Ask the contractor for a written estimate that includes any oral agreements they make in this process. The estimate should contain a line-by-line breakdown of costs, including materials and labor. In addition, there should not be a charge for an estimate. Avoid dealing with contractors who attempt to charge for estimates.
    • Obtain at least three estimates along with the names and phone numbers of two former customers of the contractor. The property owner should contact these customers and ask about the work performed.
    • Verify that the contractor is licensed, bonded, and properly insured. Obtain certificates of insurance for workers compensation and general liability policies from the contractor.
    • Contact the Better Business Bureau (BBB) to see if complaints have been filed against the contractor. This step can be performed via the BBB's website.
    • Avoid contractors who ask for payment for the entire job before the work begins. The standard practice is to pay 25–33 percent of the job up front. After the initial payment, only pay for work after it is completed. The final payment should not be made until you are satisfied with all of the work performed.
    • For major work, get an experienced attorney to review the construction contract.