FEMA Explains Flood Insurance Claim and Repair Process

Main Content
Release date: 
January 28, 2008
Release Number: 
1733-066

SALEM, Ore. -- Filing an insurance claim to repair flood damage to a home or building can be a daunting proposition for any home or business owner.

The Federal Emergency Management Agency (FEMA) offers the following information to help clarify the process of filing a claim and working with a contractor to repair the damage.

A flood insurance policy holder should immediately report any flood loss to their insurance company or agent. A claims adjuster will be assigned to inspect the structure, estimate the costs of repair and send the estimate to the insurance company for review and approval for payment.

The policy holder will be required to submit a proof of loss as part of the claim package.?? A proof of loss is the policy holder's valuation of the damages and is a sworn statement made by the policyholder substantiating the insurance claim. The proof of loss is required to be submitted to the NFIP or insurance company within 60 days of the loss. There will be a proof of loss required on both the building loss and the contents loss should there be coverage for both.? The insurance company will usually provide a proof of loss form and in most cases prepare the form based on the adjuster's estimate of repair.

A policy holder who disagrees with the final figures can submit their own "proof of loss" or when signing and returning the company's proof of loss, simply send a letter outlining why they do not agree with the amount offered by the company. It is essential the document be sent to the insurance company because until the proof of loss package is received, the insurance company will be unable to issue a payment to the insured.

An important point to keep in mind is that the policy holder does not have to accept the initial estimate of the damage prepared by a claims adjuster. If the policyholder believes the claims adjuster did not cover all damages in the estimate, then the policyholder can make claim for the additional damages.

For example, there may have been hidden damage not detected by the claims adjuster during the inspection. Regardless of whether the policyholder agrees with the claims adjuster's estimate of damages, the proof of loss must still be submitted within 60 days of the loss.

Insurance company adjusters, independent adjusters and repair contractors all use software programs developed to write itemized estimates on repair of structures. If an insurance company and the contractor are in agreement on the repairs needed, there should be little difference in the final cost of the repairs.??These estimating programs are based on national data which is continuously updated with material and labor costs in different areas of the country so they stay up to date.

Discrepancies between a contractor's price for repairs and an insurance adjuster's estimate could happen for several reasons:

  • Remote areas like Vernonia raise problems with calculating repair costs because there are few, if any local contractors. When contractors are forced to drive long distances to make repairs, labor costs rise.
  • Disasters may create a spike in material costs due to shortages and demand, however in the case of the Oregon floods this may not be an issue.
  • The adjuster may have missed damage during the inspection process or damage was hidden from view. This may require a second inspection.

Although it is rare, there have been cases of some repair contractors taking advantage of the situation to inflate repair costs.

If a policy holder finds their contractor's estimate is more than the claims adjuster's estimate, the policyholder needs to notify the insurance company immediately so the claims adjuster can meet with the contractor in order to resolve whatever differences there may be.

For more information about flood insurance, go to ...

Last Updated: 
July 16, 2012 - 18:46
State/Tribal Government or Region: 
Back to Top