Bensman Risk Management, Inc.

Insurable Interests

Bensman Risk Management, Inc.
2333 Waukegan Road Suite 275
Bannockburn, IL 60015
847-572-0800 Phone
847-572-0502 Fax

Insurable Interests may offer general financial, insurance, tax and business ideas. However, due to the ever-changing tax laws as well as the complexity of the financial industry, you should seek professional advice before implementing any of the ideas contained in this newsletter. The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C. assumes no liability whatsoever in connection with the use of this newsletter.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS). Kestra IS and Kestra AS are not affiliated with The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C.

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Insurable Interests

Vol. 3, Issue 8April 2008


Experiencing a Claim Teaches Important Lessons

On a Sunday evening last summer, I was carrying a couple of folding chairs down to our basement. The steps down to our basement have a small landing about halfway down and, when I got to the landing, I noticed a box of LEGOs floating in a sea of our belongings, like a miniature cargo ship navigating a busy harbor. Our sump pump had failed sometime between Saturday evening and Sunday evening, and 16 inches of water now covered the floor of our basement. The distant rumble of thunder outside suggested more was on the way.

If you have ever called our after-hours claim number (847-772-9897), you’ve spoken to me about your claim. I try to be the voice of reason. Sometimes I say that my job is to “talk you off the ledge” during this moment of panic and dread. Now it was my turn to be the client and the agent. Firsthand knowledge of a claim has certainly given me a greater appreciation and empathy for those of you who have also had one. It reinforced the advice we give to our clients when they call to report a claim and taught me some lessons as well.

Lesson #1: If you can safely take steps to prevent further loss, do so. I needed to get the water out of my basement and prevent additional water from entering, so I grabbed the Yellow Pages and looked for a local plumber. I don’t know a good plumber from a bad one, but I noticed the name of a plumber that I recognized. I had seen their trucks in the neighborhood before, so I guessed they were at least familiar with my subdivision. Their ad also stated 24-hour service, so I figured someone would answer at 8 p.m. on a Sunday. I was in luck. A plumber would be at our house within the hour.

Lesson #2: If your loss is weather- related, odds are other people in your neighborhood are having weather-related losses, too. Start calling for help, including service people and your insurance company, right away. If you wait until the morning, you will likely wind up on a waiting list and delay your claim.

While I waited for the plumber, I called my insurance company (Travelers) and reported my claim. As the agency’s after-hours contact for claims, I have the claim phone numbers for each company programmed in the Contacts section of my cell phone. But I did not have my policy number handy, so I had to log onto our database and find it before I could access the automated phone system used by the claims department. I since have added my home and auto insurance policy numbers in my cell phone Notepad section. Please add the Bensman after-hours phone number to your cell phone contacts, along with your specific insurance company’s claims phone number and your policy numbers.

Lesson #3: After filing my claim with Travelers, I called a clean-up company. I knew I would likely get voice mail or an answering service, but I did not want to wind up on a waiting list. As part of my job, I already have the phone numbers of local clean-up companies in my cell phone Contacts section. Before you have a loss, you may wish to contact local disaster restoration or carpet cleaning businesses to see what services they offer. What are their hours? Do they work with insurance companies? Ask them how they would respond to different claims such as water or smoke damage. Add them to your contacts to avoid a search at the time of a claim.

The plumber arrived within the hour as promised. He waded through the water in our basement and replaced the sump pump. He said our water heater probably was ruined by the standing water, too, but he would have to come back the next day. I paid for the emergency sump pump replacement and started a file for receipts.

The next day, the claims adjuster arrived to review the damage. He left me with two checks. The first was his estimate for the cost of cleanup. The second was his estimate for damage to our personal property, such as the carpet, furniture, and items in storage.

The disaster restoration service arrived shortly thereafter. They immediately began removing water from the wet carpet. Then they cut the carpet into sections and removed it in large bags. Thirteen large fans and an industrial-strength dehumidifier were placed in the basement to begin the drying-out process. A fungicide was sprayed on all the surfaces to inhibit mold. The fans and dehumidifier ran non-stop for three days before the moisture levels dropped to an acceptable range.

Lesson #4: While I was removing destroyed items from the basement, the owner of the cleanup company suggested that I write down a description of everything that was being thrown away. He said that in his experience, too many people put this off, thinking they will have time later. “You don’t know how many times I’ll go past a house six or seven months after a job and I’ll still see their stuff in a big pile in the garage.”

A claim is never convenient or fun, but putting off the hard work only prolongs the agony. It may also reduce the amount of money you receive from the insurance company because the longer a claim remains open, the more money is spent on claims administration. While your adjuster is working on your claim, he or she is also working on dozens more. If your claim takes longer than anticipated, your claim may be closed due to inactivity.

All told, Travelers paid about $12,000 for my claim. I was out the cost of my deductible and the cost to replace my sump pump. The sump pump had a mechanical failure, which is not a covered cause of loss on a home insurance policy; thankfully, the resulting damage was a covered cause of loss.

I would rather not have had the loss at all, but it has made me a better insurance professional. Firsthand experience has shown me that my insurance company came through for me when I needed them the most, and I can relate my experience to new clients. It has also given me greater empathy when a client calls after-hours to report a claim. We may not be with them physically, but we are with them in spirit.

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