9-12-24 LDI Offers Policyholder Guidance Following Hurricane Francine

FOR IMMEDIATE RELEASE

September 12, 2024

Louisiana Department of Insurance Offers Policyholder Guidance Following Hurricane Francine

Hurricane Francine caused extensive property damage throughout portions of Louisiana. Now that the storm has passed, the Louisiana Department of Insurance (LDI) is focused on recovery efforts and being a resource for policyholders as they go through the claims process.

The new LDIConnect app provides the public with LDI emergency alerts, convenient access to the department’s resources and a messaging service for questions. LDConnect is available to download in the Apple App Store and Google Play Store.

“My prayers are with our friends and neighbors who are dealing with significant property damage in the aftermath of Hurricane Francine,” said Commissioner Tim Temple. “If you need to file a claim, contact your insurer first. Make sure you hire reputable contractors during the recovery process and be wary of anyone you did not contact offering to do work on your home.”

The LDI offers the following tips for policyholders who need to file a property insurance or flood claim, as well as information related to the claims process and working with contractors.

Immediately After the Storm:

Before you begin clean up, take pictures or video of the damage that occurred both inside and outside your home.
Make temporary repairs to your property to prevent further losses from the elements and to secure your property. This would include boarding up windows, placing plastic tarps over holes in the roof and drying out wet carpets and furniture. Keep receipts for materials used and keep a record of the repairs you make for the adjuster.
You can pull wet items out of your house to help prevent mold, but do not throw anything away until an adjuster has seen it.
Do not begin permanent repairs until after you have been instructed to do so by your insurance adjuster.
If you evacuate, file for Additional Living Expenses (ALE). Many homeowners policies include provisions to cover the extra expenses you encounter while displaced from your home. ALE is supposed to cover the difference between what you would normally spend on things like food and other essentials while you are at home and when you are displaced. It is designed to cover additional expenses, not ordinary bills.

Filing a Claim:

Contact your insurance agent or company as soon as possible. Gather as much information as you can about your policy including how much time you have to file a claim.
An insurance adjuster should be sent out within 30 days to inspect damage after you file your claim in a catastrophe.

Working With Your Insurer:

Know your hurricane/named storm deductible. This is the amount you have to pay out of pocket before your insurance coverage will pay for the claim. A storm deductible typically ranges anywhere from 2%-5% of a home’s total insured value. If a home is insured for $200,000 and has a 5% deductible, the first $10,000 in repairs must be paid out of pocket by the policyholder.
Cash your claim check. This does not mean that you agree with the amount of money that the insurer paid you. The initial claim payment represents what the company believes it owes you based on what its adjuster saw. Start your repairs and ask for more money if you need it.
File a supplemental claim if the actual damage to your home is more extensive than what was documented in the original adjustment. A supplemental claim adds the newly found damage or additional cost to the original claim. The insurance company may send an adjuster to review the new damage or tell you to document it with pictures and video on your own, but you should not repair the damage until it has been documented. This right to file supplemental claims is controlled by policy language but is generally available for up to two years.
Keep filing supplemental claims. You can file multiple claims for supplemental damage until your home has been restored to its pre-storm condition. If your contractor discovers even more damage when they begin the job, you can go back to your insurer again. This process can repeat itself until all damage caused by the hurricane has been repaired.
Insurers often start by paying the “actual cash value,” or depreciated value of your property. If you have a “replacement cost” policy, the insurer will pay you the remaining value of the damage or loss when you file receipts demonstrating that you have repaired the damage or replaced the items.

Next Steps After Flooding

If your home or business has been affected by flooding, you should always contact your agent as soon as possible to file your claim and get guidance about what your policy covers.

Home: Flood damage is not covered under homeowners policies, but rather under policies from the National Flood Insurance Protection Program (NFIP) or a separate flood policy purchased from a private insurer or surplus lines insurer. Most policies require property owners to protect their property from further damage after a storm, so you may need to make temporary repairs. Keep the receipts for any repairs. Your insurance policy may have a provision for reimbursement or counting money spent toward your deductible.
Auto: If you have comprehensive coverage through your vehicle policy, you should be covered for damage. Your homeowners policy does not cover your vehicle in a flood situation. Some federal disaster assistance programs may help with vehicles that are damaged by flood.

Renters: If you purchased a flood insurance policy from the NFIP or a private insurer for the contents of your home, file a claim as soon as possible. NFIP policies cover actual cash value for your contents, which is replacement minus depreciation.

Preventing Contractor Fraud:

Unfortunately, such large storm events provide an opening for dishonest contractors looking to take advantage of homeowners. The National Insurance Crime Bureau (NICB) recommends following these tips before hiring a contractor:

Assess Damages: If you think you have catastrophe-related damage, reach out to your insurance company and ask for clarification on your coverage.
Recruit a Professional: Seek out a licensed, insured and well-reviewed contractor before any potential fraudulent contractors come knocking on your door. Contact the Louisiana State Licensing Board of Contractors to verify the licensure of any contractors you are considering.

Research and Verify: Before hiring a contractor, research their credentials, reputation and track record. Check for licenses, certifications and reviews from previous clients. Verify their insurance coverage and inquire about any past complaints or legal issues.
Get Multiple Quotes: Obtain bids from multiple contractors for comparison. Be wary of significantly low bids, as they may indicate substandard work or hidden costs. Aim for a balance between affordability and quality.
Beware of Red Flags: Be alert to red flags such as high-pressure sales tactics, vague or evasive answers, or reluctance to provide written estimates or contracts. Trust your instincts and proceed with caution if something seems off.

Written Contracts: Always insist on a written contract detailing the scope of work, materials, timeline and a payment schedule that does not include large upfront payments. Review the contract carefully, ensuring that all terms and conditions are clearly outlined and agreed upon by both parties.
Stay Involved: Stay actively involved in the project by regularly communicating with the contractor and monitoring progress while keeping records of all work communications.
Seek Legal Advice if Necessary: If you suspect contractor fraud or encounter significant problems during the project, seek legal advice promptly. A legal professional can help you understand your rights, explore options for resolution, and take appropriate action to protect your interests.

Contact the Louisiana Department of Insurance if you need help. Call our office at 1-800-259-5300 or contact us online to get help with your claim, ask a question about your policy, report suspected insurance fraud and more. Visit our website for more After the Storm Resources.

About the Louisiana Department of Insurance: The Louisiana Department of Insurance works to improve competition in the state’s insurance market while assisting individuals and businesses with the information and resources they need to be informed consumers of insurance. As a regulator, the LDI enforces the laws that provide a fair and stable marketplace and makes certain that insurers comply with the laws in place to protect policyholders. You can contact the LDI by calling 1-800-259-5300 or visiting www.ldi.la.gov.