When a property loss occurs, one of the first questions is whether the restoration team can restore or must replace the damaged contents. Many policyholders start that conversation with misguided assumptions, such as the belief that the insurer will automatically pay to replace the damaged items.
"There is a misconception out there that if you have an event like a fire, your insurance company will simply replace your losses with new things," says David Gavilanes, training manager and regional business coach at Blue Kangaroo Packoutz. "But if items are able to be recovered, that's the avenue carriers will often encourage."
Staying ahead of these misconceptions is critical to a timely claims resolution. It's also one that claims professionals can take to improve policyholder satisfaction.
How Restoration Teams Assess Damage to Contents
When determining whether items are restorable, restoration teams consider contamination level, proximity to the event zone, and material type. "In a fire loss, was it a hot fire? Was there an excessive amount of smoke? That will usually let you know pretty quickly how much of it can be salvaged. Items closer to the event zone typically are not salvageable, especially if there's a visible heat line in the room," says Gavilanes. "We also have to factor in whether these items are porous, and whether there's been any delamination to the furniture."
Gavilanes notes that instances also arise where a restoration is possible but may not be cost-effective. In situations like these, replacement might be the better option. Gavilanes also points to process bottlenecks that can slow a claim, and he stresses the importance of getting ahead of them early.
"I would also say that delays in identifying priority items, reviewing inventories, signing disposal authorizations, or communicating settlement concerns can slow the process down."
Gavilanes acknowledges that policyholders are overwhelmed in these situations, which makes guiding them through the next steps early in the process that much more important.
When Policyholders Prefer Replacement over Restoration
When a policyholder is resistant to restoration and prefers replacement, coverage limits and policy structure determine what's possible, according to Gavilanes. Depreciation schedules impact the actual payout when a claimant declines restoration, and many policyholders aren't aware until they're brought into the conversation. Specialty items may also require outside vendors or experts such as an art restorer, and those costs can quickly add up depending on the item and the insured's coverage limits.
Gavilanes also points to documentation as one of the most effective tools for helping policyholders understand and trust the process. "We use 3D imaging tools like Matterport and photo documentation, and that speaks volumes about the state and condition."
That understanding helps policyholders feel more confident in how their items are handled during a claim and supports a better experience and higher policyholder satisfaction.
For more insights from the Blue Kangaroo Packoutz team of experts, click here.
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