Prepare for Claims During Hurricane Season

By: Popular One 

We are in the midst of hurricane season, and the producers at Popular Risk Services offer valuable information about the requirements for adequate insurance coverage and how to make an insurance claim if needed.

Annually, Puerto Rico is threatened by various atmospheric phenomena such as hurricanes and other inclement weather that could result in flooding due to torrential rains causing damage to properties.

In this scenario, it is important to review and update your insurance policies so that, in the event of needing to make a claim, you have the necessary property insurance coverages and their respective updated values.

When should you review your policy?

Shirley Soto Sepúlveda, Vice President in charge of Personal Risk Management Practice at Popular Risk Services, recommends reviewing your insurance coverages with your insurance producer to ensure you are properly insured before suffering a loss. They will help you identify the coverages you need and can assist you in managing any claims.

As part of the insurance policy review process, you must know about these three key concepts, both in personal and commercial property policies:

1. Limits: Refers to the insured amount in your insurance policy. In property policies, the limit should be the replacement cost, that is, what it would cost to rebuild it.
2. Coverages: It’swhat you are insuring. In the case of a property, you can insure the structure and/or its contents, whether it’s a residence and/or commercial space
3. Deductibles: This is the amount of the claim that, you as the insured, will assume before the insurer issues payment. In the case of property insurance, the deductible applies to the insured value of the property.

It is important to note that when an official hurricane warning or advisory is issued, insurers “close the market”. During the entire period of these warnings, you will not be able to acquire a policy or increase the insurance limit. It is advisable to review your policy periodically because the original replacement cost used as a reference may have changed over time. The reasons for this are diverse, including:

• increases in construction costs
• property remodels such as: changing floors, doors, and/or windows
• installation of solar panels: whether in a residence or commercial structure

Keep in mind that the Replacement Cost does not equate to the appraisal cost of a property. The former is the construction and labor cost to repair or rebuild the property, while the latter also takes into consideration the location and the market.

If you also have a business, you should review the commercial policy, as you do with your personal policies, and consider the same concepts of the property’s replacement cost:

• building and improvements made
• contents (office equipment, inventory, machinery, etc.)
• loss of income coverage

Preparation begins much earlier

Attorney Evelyn Rosa Morel, Vice President of Special Risks Practice at Popular Risk Services, offers these recommendations:

• Keep every invoice for any remodeling done to your property and notify your insurance producer of changes in advance.
• Take photos and/or videos of the property as it currently is, that is, before an event occurs. Keep them safe.
• If you own a business, prepare a contingency plan with your employees to know where and how they would operate in case of an atmospheric emergency.
• Review your commercial property policy to ensure the limits are adequate and everything is covered: from changes made to the new inventory.
• Verify that the policy has Loss of Income or Business Interruption coverage.

Know the exclusions of the policies

Generally, property policies do not cover the risk of flooding. Therefore, if you identify this exposure, it is important to acquire a flood policy. Take note: events from hurricanes, torrential rains to clogged sewers can expose your property to flooding.

Attorney Morel emphasizes the topic of the period to present the claim. It must be done in a reasonable time, to allow insurance companies to investigate and adjust it.

When it’s time to claim…

At the time of the loss, it is advisable to contact your insurance producer, who knows the policy and can make recommendations and, above all: assist you from the beginning of the claim to the delivery of the check.

At the time of the incident, you as the insured must collect as much information as possible to present it to the insurance company as part of the claim. The required documentation includes the following:

• insured’s name 
• date and time of the incident 
• description of what happened 
• photographs and/or videos before and after the damage 
• damage estimate
• incident report

“When collecting the documentation, it is always recommended to work hand in hand with your producer, because they will facilitate communication with the insurance company. In addition, they could anticipate questions from the insurer and will require additional information so that your request is complete and substantiated clearly and concisely,” emphasized Víctor Malavé Zayas, insurance producer in the Commercial Practice, of Popular Risk Services.

At Popular One ¹, our team of professionals is ready to guide and assist you in managing your finances², investments³, risks, or the professional insurances⁴ of your business or health practice. Contact your Popular Risk Services insurance producer today to help you design a personalized insurance and risk management program, through PRSsales@popular.com or by calling 787-213-0118 Monday to Friday, from 8:00 a.m. to 5:00 p.m