Presenting Damages To Insurers: 3 Simple Steps

Getting the most out of your insurance claim requires a clean and clear presentation of covered costs and expenses.  Adjustors and even coverage lawyers have dozens of claims to sort through each day, and if the adjustor can’t understand each dollar claimed immediately, it’s much easier for the adjustor to deny that dollar rather than pay it.  Correctly categorizing, itemizing, and backing up each dollar of an insurance claim is critical to a favorable adjustment or settlement of claims.  Here’s how, in 3 simple steps.

1.  Prepare A “Claim Summary” Cover Sheet.  This is a one-page cover sheet, typically a spreadsheet, that sums up your claim with a total at the bottom.  This isn’t where you itemize every invoice; instead, the Claim Summary gives the bigger picture, and shows only the total for each category of damages.  Categories may include Repair Costs to Date, Estimated Costs to Complete Repair, Business Income Losses, Investigation and Design Costs, Attorney Fees and Costs, and Treble/IFCA/Punitive Damages.  Unless your claim is a complicated amalgam of estimates, business losses, sunk costs, and more, the Claim Summary shouldn’t be more than a half page.


2.  Prepare An Itemized Listing Of Every Invoice/Cost Item.  Using the same category structure, expand each category to include a line for each and every charge of the claim.  For example, if one of the claim cost categories is Repair Costs To Date, then list each repair invoice under this heading.  If there are multiple invoices from 3 different contractors, then create a subheading for each contractor and list each of that contractor’s invoices under its subheading.

3.  Include Organized Backup.  Now that the claim is presented, it must be substantiated.  To do this, attach backup documentation for each and every line item of damages prepared in no. 2 above, in the same order as the list prepared in the last step.  Sometimes, where damages are estimated or not yet incurred, the backup will consist of written estimates or expert reports; regardless, it’s critical to have some sort of backup for each and every dollar claimed.

When presenting claims and damages, don’t forget the importance of psychology.  Pie-in-the-sky claims are likely to shut the insurer’s decion-maker down.  On the other hand, including some wiggle room in claims allows the decision-maker on the other side to look good when she negotiates the claim down, but still pay out a reasonable amount on the claim, creating a win-win for both sides.
Photo Credit: GotCredit

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