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What You Need to Know About How Do Insurance Claims Work

Picture this: Your home has suffered significant damage from a recent storm. These incidents are not only stressful, but they can also lead to financial strain. That’s where insurance claims come in. By understanding “how do insurance claims work”, you can navigate the challenges and ensure you receive the compensation you deserve. In this blog post, we’ll explore the various types of insurance claims, the role of public adjusters, and how to tackle common claim challenges.

Key Takeaways

  • Understand the insurance claim process and your policy coverage.

  • Know when to hire a public adjuster and how to negotiate settlements effectively.

  • Be proactive in addressing common challenges such as delays, disputes, or denied claims.

Understanding the Insurance Claim Process

a person filing an insurance claim with an insurance company

A policyholder submitting a request for compensation to the insurance provider is called an insurance claim. Such requests are typically made when a covered loss occurs. The insurance claims process might seem complex at first glance, but it can be broken down into three essential steps: reporting the incident, working with insurance adjusters, and reviewing your policy coverage.

Once you’ve understood these steps, navigating the claims process will become more effortless, ensuring a smooth experience.

Reporting the incident

The initial step in filing an insurance claim is reporting the incident to your insurer providing accurate information about the accident, damage, and any involved parties. Proper documentation is crucial, as it serves as evidence for you and the insurance company. This includes photographs and videos of the incident, which can be useful in documenting property damage. When filing a claim, consider the potential impact on your insurance premiums.

Another aspect to consider during the incident report is the selection of a contractor for repairs. Although the insurance company may provide recommendations, you can choose your contractor. Payments for property damage claims are typically issued in stages during the repairs process and may be made out to both the policyholder and their mortgage lender if applicable.

Working with insurance adjusters

The claim process heavily relies on the role of insurance adjusters, who are responsible for assessing the damage and calculating the cost of repairs. In liability claims, the adjuster may request a statement regarding the incident and contact information for the injured party to assess a suitable payout.

Certain insurance companies may ask for an estimate of repair costs to assess your damage adequately. Your insurance company may pay the contract directly if the required Direction to Pay (DTP) is filed or provide reimbursement to you for payment of the bill.

The damages appraisal stage involves an adjuster or third-party contractor evaluating the severity of the damages and may include interviewing witnesses or parties involved.

Reviewing your policy coverage

Reviewing your policy coverage and understanding your deductible, transportation expense coverage, and claim submission deadlines is vital in the insurance claim process.

A deductible is the amount the policyholder is responsible for paying out of pocket for repairs before insurance coverage begins.

In the case of a hurricane deductible, the amount is typically calculated as a percentage of dwelling coverage.

A thorough review of your policy coverage with home insurance companies can help streamline the claim process and prevent surprises.

Types of Insurance Claims

type of insurance claims on long island, homeowners, car, liability

Insurance claims can be categorized into three main types: property damage, personal injury, and liability. Each type of claim serves a different purpose and covers various aspects of potential losses.

Grasping these types of claims will assist you in identifying the one applicable to your specific situation, making the process more efficient.

Property damage claims

an illustration showing the types of property damage claims in Long Island, NY

Property damage claims refer to the coverage for losses incurred due to damage to one’s property, such as fire damage, flood, water damage, weight of snow or frozen pipes.

Compensation is calculated based on the actual cash value, the depreciated value of your property, or the replacement value, which is the cost to replace the damaged item with a new one.

Personal injury claims

Personal injury claims cover expenses related to medical care, lost wages, and other damages resulting from an injury caused by an accident or other event.

Initiating a personal injury claim involves contacting the insurance company of the party responsible for the injury and providing supporting evidence of the harm and the damages claimed.

Negotiating a settlement in a personal injury claim requires:

  • Understanding the value of your claim and the amount of compensation you are seeking

  • Being prepared to negotiate with the insurance company

  • Being open to compromise

Liability claims

Liability claims cover losses incurred by another individual or entity due to the actions of an individual or business. These claims generally include property damage and personal injury claims.

You must notify your insurance company to file a liability claim and submit evidence of sustained damage or injury. In some cases, a public adjuster can be helpful in the claims process, providing expertise and guidance throughout the procedure.

The Role of Public Adjusters in Insurance Claims

a couple discusses filing a homeowners insurance claim with a public adjuster

Public adjusters are insurance specialists who can be hired to manage claims and advocate for the client. They can provide valuable assistance in complex claims or disputing a settlement offer. Public adjusters offer a range of services, including:

  • Assessing damage

  • Documenting and preparing the claim

  • Reviewing the insurance policy

  • Negotiating settlements on behalf of the policyholder

Hiring a public adjuster can help ensure you receive a fair and accurate settlement for your insurance claim.

In the following, we’ll delve into the role of public adjusters in insurance claims, pinpoint when one might be needed, and guide you on locating a reputable public adjuster.

What is a public adjuster?

A public adjuster is an insurance specialist hired to oversee claims and represent the client, offering expert guidance on the claims process, reviewing policy coverage, and ensuring the highest compensation for a claim. They typically charge a percentage of the claim settlement, ranging from 5% to 12.5% in NYS.

Long Island Public Adjusters, LLC charges an average of 7.5%.

Public adjusters, as independent insurance professional experts, can be enlisted by policyholders to assist in negotiating an insurance claim, often providing an alternative to working directly with an insurance company’s adjuster.

When to hire a public insurance adjuster

In certain situations, such as when handling a complicated or large claim or disputing a settlement offer, it may be advantageous to hire a public adjuster. Engaging public insurance adjusters can assist you in navigating the insurance claim process, offer specialized advice, and guarantee that you receive the highest compensation for your claim, i.e., you make more money.

However, there are also potential drawbacks to engaging the services of a public adjuster, such as the associated cost and the possibility that they may not be able to obtain a higher payout than what the insurance company is proposing.

Finding a reputable public adjuster

Finding a good public insurance adjuster can be achieved through various means, such as seeking referrals from trusted sources, conducting research online, or contacting your state’s department of insurance.

The National Association of Public Insurance Adjusters is a professional organization dedicated to providing support for insurance adjusters.

To identify a reliable adjuster, verify their licensing in your state, check for potential complaints filed with the Better Business Bureau, and ask for references. By thoroughly vetting a public adjuster, you can select the best professional to represent your interests during the claims process.

Want to hire a public adjuster? Contact Kevin Godfrey at 516-410-0164 or email

Navigating Insurance Settlements

a person negotiating an insurance settlement with an insurance company

Insurance settlements are the payments made by insurance companies to resolve a claim, and they are typically determined through negotiations between the parties involved. Navigating insurance settlements can be a complex process, requiring a thorough understanding of your policy, the value of your claim, and the ability to negotiate with the insurance company.

Let’s now discuss the negotiation of settlements and the procedure for accepting or disputing a settlement offer.

Negotiating settlements

Negotiating settlements is a crucial part of the insurance claim process, as it determines the settlement you will receive. This may involve providing additional documentation to support your claim, such as photographs or invoices.

In some cases, working with a public adjuster can be beneficial in negotiating a settlement, as they offer expertise in navigating the claims process and ensuring a satisfactory outcome.

Accepting or disputing settlements

Upon reviewing the settlement offer, you must assess whether it is fair and adequately covers your losses. If the offer is not satisfactory, you may dispute the settlement and attempt to negotiate a more agreeable offer.

This may involve providing additional documentation, working with a public adjuster, or seeking legal advice if necessary.

By thoroughly evaluating the settlement offer and considering your options, you can make an informed decision on whether to accept or dispute the settlement.

Common Insurance Claim Challenges and How to Overcome Them

Insurance claims can present several challenges, such as delays in processing, disputes over coverage or damages, and denials. Overcoming these challenges often requires persistence, organization, and a thorough understanding of your policy and the claims process.

Let’s now examine common challenges associated with insurance claims and strategies to overcome them.

Delays in processing claims

a person needs a public adjuster for a denied claim

Delays in processing claims can be caused by a variety of factors, such as incomplete information or documentation submission, a backlog of claims, or a dispute between the insurer and the claimant. To tackle these delays, maintain organization, provide all necessary documentation, and keep regular follow-ups with your insurer.

By proactively addressing potential issues and staying in communication with your insurer, you can help expedite the claims process and receive your compensation sooner.

Disputes over coverage or damages

Disputes over coverage or damages arise when the insurer and the claimant disagree on the amount of coverage or the extent of the damages in a homeowners insurance claim. Resolution of these disputes might necessitate additional evidence like photographs or repair estimates, negotiations with the insurance company, or the services of a public adjuster to advocate on your behalf.

By gathering the necessary evidence and being prepared to negotiate, you can increase your chances of reaching a fair settlement.

Denied claims

Denied claims can be frustrating and may require additional effort to resolve. The insurance company will provide a written explanation for the denial of insurance coverage, which can be used to determine the best course of action.

Appealing a denied claim may involve submitting additional documentation, engaging the services of a public adjuster, or consulting with legal counsel. By exploring these options and understanding your rights as a policyholder, you can increase your chances of successfully appealing a denied claim and receiving the compensation you deserve.


Navigating the insurance claim process can be a daunting task, but by understanding the various types of claims, the role of public adjusters, and how to overcome common challenges, you can confidently manage your claim and secure the settlement you deserve.

Remember to stay organized, communicate with your insurer, and seek professional assistance when needed. By doing so, you can ensure a smoother claim process and protect your financial well-being in the face of unexpected incidents.


Frequently Asked Questions

What are the 4 stages of insurance claim?

The four stages of an insurance claim process are adjudication, submission, payment, and processing.

These steps must be followed to ensure a successful claim is processed and paid out.

Can you pocket the money from an insurance claim?

Yes, you can keep the money from an insurance claim and settle for the undisputed actual cash value or ACV. This would remove your ability to collect the recoverable depreciation.

How do insurance companies calculate claims?

Insurance companies calculate claims by determining liability, assessing the damages sustained - usually through an estimating software called 'Xactimate', and referencing policy terms.

This process allows them to offer an appropriate settlement to affected parties.

What are the negatives for using a public adjuster?

Using a public adjuster can take a longer time than doing it yourself, and they may not handle all types of claims.

Additionally, they typically take a percentage of the settlement, which could potentially reduce the amount you receive.

What is a public adjuster in Long Island, New York?

A public adjuster in NY is an individual licensed by the Department of Financial Services who helps process claims after an insured loss or damage.

Kevin Godfrey, Long Island Public Adjusters contact information

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