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How to navigate insurance claims, post-Hurricane Harvey

  • Insured losses from Hurricane Harvey could be as much as $10 billion to $20 billion, according to JPMorgan.
  • Only 12 percent of homeowners nationwide have flood insurance, according to the Insurance Information Institute.

Consumers affected by Hurricane Harvey aren't in for an easy financial recovery.

Harvey, the most powerful hurricane to hit Texas in more than 50 years, has triggered unprecedented catastrophic flooding in Houston and other areas of southeastern Texas. On Monday, forecasters at the National Hurricane Center warned that Harvey (now a tropical storm) is expected to continue dumping rain on the area throughout the week, with advisories in effect for flooding and flash flood emergencies.

Insured losses from Harvey could be as much as $10 billion to $20 billion, putting it among the top 10 costliest hurricanes to hit the U.S., investment bank JPMorgan told clients Monday.

For Texans, handling the insurance aspects probably isn't top of mind — nor should it be.

"The issue right now is safety — getting people out, evacuating," said Loretta Worters, a vice president for the Insurance Information Institute.

Once you're to a place of safety, here's how to start navigating the claims process:

Alert insurers

Insurance adjusters can't get in until the flood waters have receded, Worters said, but it helps to pre-emptively reach out and let your agents know your home and vehicle have sustained storm damage. That helps insurers know both where to go to look for damage, and where to find you in the coming days and weeks to more quickly provide assistance.

Another reason to act fast: Insurers often handle claims on a first-come, first-serve basis, said J. Robert Hunter, director of insurance for the Consumer Federation of America.

Consumers likely need to make several calls. (Ideally, policy numbers and agent contacts would have been part of an emergency "go bag.")

Homeowners: You may have several kinds of coverage. In addition to a primary homeowners insurance policy, some homeowners may also have separate wind damage coverage via the Texas Windstorm Association, and flood insurance with the National Flood Insurance Program or a private insurer, Worters said.

"Don't assume you don't have coverage." -Peter Kochenburger, deputy director, Insurance Law Center

Even if you don't have flood insurance (only about 12 percent of homeowners do), call your home insurer, said Peter Kochenburger, deputy director of the Insurance Law Center at the University of Connecticut School of Law. Homeowners policies specifically exclude damage related to flooding, but water and wind damage are separate issues. (For example, you could be covered for water damage resulting from wind damage to the roof, or a flying tree branch that broke a window, he said.)

"Don't assume you don't have coverage," he said.

Auto: The comprehensive portion of your auto insurance typically would cover flooding and other storm-related damage, up to the vehicle's market value, Worters said.

Travel: Texans currently traveling should reach out to their travel insurance provider, if they bought a policy for their trip. The "trip interruption" portion could kick in for policyholders who need to cut short their travels due to the hurricane damaging property, said Megan Singh, project management director for insurance marketplace Squaremouth.

"They could actually be covered to return home," she said — including the cost of a new flight and reimbursement for hotel nights and other prepaid expenses left unused as a result of the shortened trip.

A damaged house and car resulting from hurricane Harvey, August 26, 2017.
Rick Wilking | Reuters
A damaged house and car resulting from hurricane Harvey, August 26, 2017.

Keep good records

Take notes documenting every contact with your insurer, including who you spoke with, when, and what was said. Those details can be important if you later have any difficulty with your claim, or need to file a complaint, Hunter said.

"You want to be able to remember exactly what happened," he said.

Keep your claim numbers at hand for easy reference. That helps insurers route you quickly to the claims department, which will have the most up-to-date info on your claim, he said.

Save receipts

Your homeowners policy may include "additional living expense" coverage that provides reimbursement for immediate expenses like emergency repairs, temporary housing and meals, Kochenburger said. Ask your agent about that coverage. Insurers often reimburse those expenses quickly.

Explore alternatives

Consumers who don't have insurance or are underinsured aren't without recourse, Worters said.

Check DisasterAssistance.gov (run by the Federal Emergency Management Agency) to see if you qualify for grants or low-interest loans to help cover expenses such as temporary housing, emergency home repairs and property losses, she said. Nonprofits are also collecting donations to provide aid and supplies to people in need.