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Attorney helps homeowners with fire insurance after wildfires – her advice, be prepared

Natascha O'Flaherty still takes calls from insurance carrier asking her clients to remember things like how old the food was in their fridge before it burned.

GRANBY, Colo. — Natascha O'Flaherty can't forget the flames she saw from the East Troublesome Fire on October 21 – she also can't forget what her friends and clients are forced to remember by insurance companies.

"It's hard to recall everything you had when all you're looking at is a pile of ash," said O'Flaherty, a Granby attorney.

Nearly 10 months later, and the laywer is still helping people who lost everything sort through their insurance claims. 

"No joke, this morning a carrier called and wanted my client to identify how old the food was in the refrigerator," she said. "No joke. I can't even make this stuff up."

Some insurance carriers require an inventory of everything in the home when it was destroyed, but that's not always something the homeowners know they will have to do. 

RELATED: Boulder family in insurance battle nearly 7 months after losing home in the Calwood Fire

"My advice would be to set yourself up for success long before the fire happens," said O'Flaherty. 

She said to take pictures of everything in your home now, and to make sure you have a digital blueprint of your house, and not just a physical copy.

"I just told all my friends when I say take pictures, in order to have a successful pay out on contents, if you don't have a minimum of 400 photos up in the cloud, you're not going to have an easy time getting your claim paid," said O'Flaherty.

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Most importantly, she wants homeowners to know their rights and their policy.

"It is not exciting bed time reading," she said. "But, I absolutely think everyone should read their policy."

The following is an excerpt from a letter O'Flaherty sent to friends and clients explaining what to look for in a policy and tips for how homeowners can prepare now: 

  • Policy Coverage: Based on the size and construction details of your home, does your coverage provide enough funding to rebuild your home based on current local building costs?
  • Other Structure Coverage: Is the coverage for your other structures (garage, barn, shed, accessory building, fencing) adequate?
  • Replacement Cost Coverage: Does your policy cover replacement coverage for both the structures and the contents?
  • Extended Replacement Coverage:  Does your policy offer an extended coverage rider? This rider is important in a community like our where home prices are rapidly appreciating. This rider offers anywhere from 20%-100% in addition to the coverage limits of your policy.
  • Ordinance and Law Coverage: Ordinance and Law is a rider that is required to be offered in Colorado. It provides insurance coverage for any increased cost of demolition or repair/rebuild associated with the enforcement of building ordinances and laws.
  • Loss of Use Coverage (aka Additional Living Expense or ALE): Is your loss of use coverage adequate?   The loss of use coverage pays for the increased living expenses during the time to repair to replace your home.  (Note,  that if you opt to relocate and purchase a home, ALE is also applicable.)

Look for a policy that offers 24 months of coverage – after a large-scale fire, the shortage of labor and materials may delay when a home can be rebuilt. 

Plus, in a mountain community where the building season is short, the 12 months minimum coverage required for policies sold in Colorado may not be adequate. Ideally, the policy offers coverage amounts for actual loss with no dollar limits. 

This coverage not only pays for rent incurred, but it can also be used to purchase an interim home or condo, fifth wheels or other alternate interim housing solutions.

This coverage also covers expenses for animal boarding, storage unit rental and other expenses incurred as a result of the loss of the home.

  • Catastrophic loss rider: This rider provides additional funds in the event of a total loss above and beyond the policy limits. This is a meaningful rider offered by a few carriers, that depending on the carrier, provides significant additional coverage amounts and simplified claims payout.
  • Wildfire Endorsement coverage:  This is a rider pursuant to which the carrier may provide at their expense wildfire suppression measures to help protect your home from a wildfire.

Lastly, after spending the last eight months developing an expertise in the claims handling process and the Colorado laws governing insurance claims, I would also recommend the following. 

If you have blueprints for your home, store them on the cloud or other secure place (Note, some high-end fireproof gun vaults, only had ashes inside after the East Troublesome Fire).

Take extensive photos of both the interior, exterior and landscaping of your home. This includes opening each drawer and cabinet and taking pictures of the contents. Store these pictures on the cloud or other safe place.

Should you have to file a claim:

  • Notify carrier of claim as soon as possible.
  • Keep receipts of all expenses incurred during the initial evacuation (reimbursable from ALE coverage)
  • Document all communications with your agent and carrier in WRITING
  • Request a certified copy of your policy.

Most importantly BE INFORMED. Know your rights as a policy holder and the rules that your carrier must follow. In 2013, meaningful legislation was enacted in Colorado that provides numerous important consumer protections, including but not limited to:

  • Carrier must provide copy of the policy, including the declaration page and any endorsements, within three business days.
  • A certified copy of the policy must be provided within 30 days of the request.
  • Policies that include ALE must offer at least 12 months of ALE.
  • In the event of a total loss of an owner-occupied primary residence, 30% of the personal property coverage must be paid timely without itemization and the policy owner can submit a personal property inventory to claim the remaining 70% of coverage.
  • A reasonable estimate of the loss of the covered property must be paid within 60 days of the loss.
  • Insures MUST consider, subject to the insurer’s underwriting requirements, an estimate from a licensed contractor or licensed architect submitted by the policyholder as the basis for establishing the replacement cost of a dwelling.
  • Policy owners have one year after the loss to submit their personal property inventory. 
  • Penalty interest may apply on payments to policyholders that are paid late.

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