If you’ve recently suffered damage to your home, you may wonder how to cash your homeowner’s insurance claim check. Here’s what you need to know about cashing a check from your insurance company.
Thanks to our partners at Legal Grit homeowners insurance claim attorney in Florida, who helped us write this article!
How do home insurance companies pay out insurance claims?
After filing a claim, you could get many homeowner’s insurance settlement checks, albeit the recipients of these payments will depend on the extent of the damage.
You can submit a claim with your home insurance to cover the cost of repairs or replacements if a covered loss results in damage to your house or personal property. If your claim is approved, you’ll get one or more homeowner’s insurance settlement checks to pay for the damage.
However, the kind of claim, location, and homeowners’ insurance provider will all impact who receives these payouts and when.
Can I cash an insurance check?
Your insurance provider will normally send you a check for the money you are entitled to when you submit an insurance claim for harm done to your house. However, it would be best if you first thought about a few factors that might affect your insurance coverage now and in the future before rushing out to cash the check.
Know your policy: To ensure that the amount of the reimbursement you get is accurate, you must have a complete grasp of your insurance coverage. To find out if you’re receiving all the benefits to which you are entitled, evaluate the damage to your property and consider the terms of your insurance.
Know your rights: You must comprehend every clause in an insurance policy because the terminology is often highly complex. In many instances, accepting a check from your insurer to pay for losses will result in you giving up any further claims for reimbursement.
This clause implies that your insurance will no longer pay for further incidents related to the first issue. You will therefore be responsible for covering any additional costs for repairs that exceed what your insurance policy would have covered.
You have every right to negotiate the amount of your reimbursement, so it’s worth contacting your insurance provider to start the appeal process if you believe you should be getting more money.
How to cash a homeowner’s insurance claim check
When you’re convinced that the amount of money shown as your reimbursement on the check you got from your insurance provider is acceptable, you can start cashing it.
There are several cases where an insurance check includes the name of another party (for example, an extra policyholder) or institution (like your bank or mortgage lender), even though certain insurance checks are rendered payable to a specific individual and can be paid right away.
In this scenario, to cash your check at a credit union or bank, you would need signatures from each person/party.
Additionally, you might not be able to get the money right away due to conditions in your insurance policy contract or legal requirements imposed by your state. Since they theoretically still own the property where you are getting insurance coverage, if you, for instance, have a mortgage, your mortgage lender will need to endorse the check, which might cause your estimated payback schedule to be delayed.
How to hasten the claims settlement process
Here are a few strategies for quickening the claims settlement procedure and, preferably, receiving payment quicker.
- Submit your claim as soon as possible. The majority of house insurance policies contain deadlines by which you must file a claim. The sooner you report it, the more details you can provide your insurance provider, and the more recent the occurrence will be in your memory.
- Keep in constant contact with your claims adjuster. You should be reachable by your insurance provider if they need to get more information about your claim or ask questions. This process can entail scheduling a house inspection to determine the damage’s cost.
- Keep track of the costs and payments related to your claim. After a loss, keep the receipts for any urgent expenses you incur. Keep your home inventory close by since your insurance company might need it to confirm the exact monetary worth of your possessions during the settlement procedure.
Who gets the home insurance claim payments?
Payments from the homeowners’ insurance claim may be made to you directly. Conversely, if you’re actively paying off your house and your mortgage lender is listed as a “named insured” on your home insurance policy, the claim settlement funds may occasionally be delivered to them.
Owner of the property
You will get the payment through a check or direct deposit if a claim settlement check is written out to you directly.
The contractor working on your home
Your contractor, who is executing the repairs, could receive direct payment from your claim settlement.
Your signature on a “direction to pay” form authorizing your insurance provider to pay your contractor directly may be required by their construction business before a claim payment can be given to them. The construction business of the contractor then submits a claim to your insurance provider.
Before your insurance provider sends the contractor the last payment and closes the claim, ensure you are happy with the repairs.
Mortgage lender or condo management company
You and your condo management company or mortgage lender might also get a check payable to both of you. The third-party must sign the check to be valid before you can cash it. This process enables the management company or lender to guarantee that all required repairs are done.
A different option would be for your lender to hold the funds in escrow and disburse payments when the repairs are finished.