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Rocky Mountain Insurance Information
NEWS
6565 South Dayton St. #2400, Greenwood Village, Colorado 80111
Serving Colorado, New Mexico, Utah & Wyoming
Contact: Carole Walker, Executive Director
(303) 790-0216 or 1-800-355-9524
Release Date: Immediately
Topic: Catastrophes
INSURANCE ADJUSTERS ARE ON THE SCENE IN RUIDOSO, NEW MEXICO TO BEGIN PROCESSING CLAIMS FROM THE KOKOPELLI WILDFIRE: Industry officials say the first damaging wildfire of the season is a wake- up call to homeowners to check insurance coverages.
March 26, 2002 - Insurance companies are responding to the property damage caused by the Kokopelli Wildfire that burned some 28 homes near Ruidoso, New Mexico over the weekend. Claims adjusters are beginning to arrive on scene to speed up the claims settlement process. The Rocky Mountain Insurance Information Association (RMIIA) has advice for homeowners impacted by the fire:
- Residents who are displaced from their homes or who live elsewhere should contact their agents or companies immediately to let them know where they can be reached. As adjusters are allowed into evacuated areas, they will want to go with their policyholders to access the damage. Many companies have 24-hour emergency hotlines and their websites can be accessed through the industry website at www.rmiia.org .
- Company claims adjusters, many equipped with laptop computers and portable phones, will start writing checks over the next few days to pay the cost of temporary living expenses for people left homeless by the fires and to begin the rebuilding of damaged homes. Contact your agent or company if you need additional living expenses while you are out of your home.
- Keep receipts. Out-of-pocket expenses during a mandatory evacuation are reimbursable under most standard homeowner policies.
- Be prepared to give your agent or insurance representative a description of your damage. Your agent will report the loss immediately to your insurance company or a qualified adjuster who will contact you as soon as possible to inspect the damage. Again, be sure to give your agent a number where you can be reached.
- Take photos of the damaged areas. These will help with your claims process and will assist the adjuster in the investigation.
- Prepare a detailed inventory of all damaged personal property. Be sure to make two copies-one for yourself and one for the adjuster. Your list should be as complete as possible, including a description of the items, dates of purchase or approximate age, cost at time of purchase and estimated replacement cost.
- Make whatever temporary repairs you can . Cover broken windows, damaged roofs and walls to prevent further destruction. Save receipts for supplies and materials you purchase. Your company will reimburse you for reasonable expenses in making temporary repairs.
- Secure a detailed estimate for permanent repairs to your home from a reliable contractor and give it to the adjuster. The estimate should contain the proposed repairs, repair costs and replacement prices.
- Serious losses will be given priority . If your home has been destroyed or seriously damaged, your agent will do everything possible to assure that you are given priority.
The most costly New Mexico wildfire was the Cerro Grande Fire in May 2000 with an estimated $140 million in insured losses. The most expensive wildfire in U.S. history was the October 1991 Oakland Hills fire, which caused $1.7 billion in insured losses (about $2 billion in today's dollars). Catastrophic fires account for 3% of insurance losses. That compares to 33% for hurricanes, 32% for tornadoes and 13% for earthquakes.
ARE YOU COVERED?
Fire officials predict an early and potentially devastating fire season in the Rocky Mountains and this first major blaze should serve as a wake-up call to homeowners and renters. RMIIA wants to alert homeowners across the state about the basic need to do annual insurance policy "check ups" to make sure they keep up with local building costs, home remodeling and inventories of their personal belongings. The fire is also a warning to renters, who often don't carry any insurance at all.
When you insure your home, you are really insuring two distinct things-
1) The structure of your home
2) Your personal belongings
TIPS FOR INSURING YOUR HOME TO ITS VALUE
You should insure your home for the total amount it would cost to rebuild your home if it were destroyed. That's not the market value, but the cost to rebuild. If you don't have sufficient insurance, your company may only pay a portion of the cost of replacing or repairing damaged items. Here are some tips to help make sure you have enough insurance:
- For a quick estimate on the amount to rebuild your home - multiply the local building costs per square foot by the total square footage of your house. To find out the building rates in your area, consult your local builders association or a reputable builder. You should also check with your insurance agent or company representative. (Note: This is only an estimate and shouldn't replace annual coverage reviews).
- Factors that will determine the cost to rebuild your home: a) construction costs b) square footage of the structure c) type of exterior wall construction-frame, masonry or veneer d) the style of the house (ranch, colonial) e) the number of rooms & bathrooms f) the type of roof g) attached garages, fireplaces, exterior trim and other special features like arched windows or unique interior trim.
- Check the value of your insurance policy against rising local building cost EACH YEAR. Check with your insurance agent or company representative if they offer an "INFLATION GUARD CLAUSE." This automatically adjusts the dwelling limit when you renew your policy to reflect current construction costs in your area. However, you still should keep up with local building costs by checking in periodically with your local builders association.
- Check the latest building codes in your community. Building codes require structures to be constructed to minimum standards. If your home is severely damaged, you might have to rebuild it to comply with the new standards requiring a change in design or building materials. These generally cost more.
- Do not insure your home for the market value. The cost of rebuilding your home may be higher or lower than the price you paid for it or the price you could sell it for today.
- Most lenders require you to buy enough insurance to cover the amount of your mortgage. Make sure it's also enough to cover the cost of rebuilding.
- Increase the limits of your policy if you make improvements or additions to your house.
The most important thing you can do to safeguard your home and property is to understand that your insurance policy is a contract and you need to know what's in it . Your insurance agent or company representative will be able to walk you though it and answer any questions. The bottom line: Don't put your policy up on a shelf somewhere and let it collect dust! Review your policy every year.
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Rocky Mountain Insurance Information Association is a non-profit consumer information organization. Affiliated with the Insurance Information Institute, RMIIA has been serving consumers and the media since 1952.
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