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Best practices for handling a property claim

In the hospitality industry, property claims can be a significant challenge for hotel owners. Whether due to natural disasters, accidents, or unforeseen incidents, managing property claims effectively is crucial to minimize financial loss and ensure timely repairs. Here are five best practices for handling a property claim to ensure your hotel is well-prepared and the claim process runs smoothly.

1. ENSURE ALL COVERAGES ARE CONSIDERED
In many cases, important coverages are overlooked in property-loss claims. It’s essential to have an experienced policy handler adjust your file. While building damage usually is addressed, several other coverages often go unnoticed, such as:

  • Business interruption: Coverage for lost income due to the disruption of normal business operations.
  • Business personal property: Protection for movable items owned by the business, such as furniture, equipment, and inventory.
  • Code upgrades/ordinance and law: Coverage for the increased costs of bringing the property up to current building codes during repairs.
  • Pairs and sets: Coverage that ensures the replacement of entire sets if one part of a pair or set is damaged.

 

2. DOCUMENT THE LOSS TO ITS FULL EXTENT
One of the most critical steps in handling a property claim is to thoroughly document the damage. This documentation should include:

  • Photographs and videos: Capture images and videos of all visible damage from multiple angles. Ensure all affected areas – inside and outside the property – are covered.
  • Detailed descriptions: Write detailed descriptions of the damage, including the location and extent of each issue.
  • Inventory of damaged items: Create an inventory of all damaged items, including furniture, equipment, and other property. Note their condition before the incident and estimate the cost of repair or replacement.

 

3. VERIFY AND DOCUMENT HIDDEN DAMAGES
Visible damage is only part of the equation. Hidden damages, such as those behind walls or under flooring, can often be more significant and costly. To ensure these are addressed:

  • Professional inspections: Hire professionals to inspect areas that aren’t immediately visible. This might include mold inspectors, structural engineers, or HVAC specialists.
  • Use of specialized equipment: Ensure inspections utilize equipment capable of detecting hidden damages, such as moisture meters, thermal imaging cameras, and other diagnostic tools.

 

4. ESCORT THE ADJUSTER DURING THE INSPECTION
When the insurance adjuster arrives to assess the damage, it’s vital to have someone knowledgeable about the extent of your hotel’s damages accompany them. This person should:

  • Point out all issues: Ensure all damages – visible and hidden – are pointed out to the adjuster. This includes areas that might be easily overlooked or underestimated.
  • Provide supporting documentation: Share all photographs, videos, and written descriptions with the adjuster. This documentation will support your claim and help ensure nothing is missed.
  • Highlight the need for specialized equipment: If the adjuster doesn’t have the necessary equipment to detect hidden damages, emphasize the importance of these tools and suggest follow-up inspections with the appropriate equipment.

 

5. AVOID SOLO INSPECTIONS BY THE CARRIER’S ADJUSTER
Allowing the carrier’s adjuster to complete an inspection alone can lead to significant oversights. Without guidance, they may miss or undervalue critical damages. To avoid this:

  • Always have a representative present: Ensure someone familiar with the full extent of the damages is present during every inspection. This representative should be prepared to answer questions and provide additional information as needed.
  • Communicate clearly: Make it clear to the adjuster a comprehensive evaluation is essential for a fair settlement. Stress the importance of identifying all damages to prevent future issues and additional claims.

 

CONCLUSION
Handling a property claim effectively requires meticulous documentation, proactive communication, and thorough inspections. By following these best practices, hotel owners can ensure all damages are accurately assessed and appropriately compensated, leading to timely repairs and minimal disruption to operations.

The initial adjuster inspection is crucial; once the adjuster forms an opinion regarding the loss and sets reserves, it’s challenging to change their mind, especially if the oversights are substantial. For example, covered water damage to wallpaper in a corridor where the wallpaper is no longer available would necessitate replacing all continuous wallpaper to ensure uniformity. The same applies to the carpet. If the adjuster is unaware of this from the start, it will be difficult to rectify later.

An experienced public adjuster can handle all aspects detailed above, ensuring the claim process is managed efficiently and effectively, allowing hotel owners to focus on their core business operations.


angel luis mercado

Angel Luis Mercado is President and CEO of MBC Public Adjusters, a company featuring a group of public adjusters and estimators who formerly worked for insurance companies and whose combined experience exceeds 40 years of working for insurance companies. This translates into expert knowledge of policy interpretation and claims handling. All of MBC’s public adjusters and estimators have hands-on construction experience and are OSHA 10 certified.


CAGKAN SAYIN/SHUTTERSTOCK.COM

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