Claims Management

Even with all the training and precautionary measures a real estate manager may take, incidents will occur. Incidents should be discussed appropriately with the manager’s insurance agent. The steps in responding to an incident follow:

• Incident Report: Internal report kept on file at the property.
• Report to Insurance Company: Report sent to the insurance company as FYI in case of future lawsuit. Sending a report to the insurance company may result in the creation a loss reserve fund, an estimate of the amount an insurer expects to pay for reported and estimated claims.
• File a Claim: Claim submitted to insurance company reporting a loss and filing a claim for money. Sometimes a filed claim results in an insurance company inspection of the property.

Insurance policies may be canceled or not renewed under certain conditions such as the following:

• Failure to pay the premiums
• Failure to remedy an identified hazard
• New risk factors
• Added amenities such as a basketball court or a coffee shop that presents new types of risks not included in the original policy
• An insurance provider deciding to exit a given market or discontinuing coverage for a specific type of property
• Filing many small claims or one large claim

Reporting a Loss

A real estate manager must ensure that procedures are in place and staff members are trained to handle emergencies. Proper handling of the situation will make filing a claim with the insurance company easier and more successful. In the event of injury or property damage:

• Ensure immediate aid is given to an injured person or people.
• Call emergency personnel for assistance.
• Obtain the names and addresses of people involved and witnesses. Write down the name of everyone you see at the site of the loss in case you need to contact them later. Capture who, what, where, how, why. 
• Report a crime to the police, and let them take any necessary statements for the police report.
• Call your insurance company. Check your policy for requirements about reporting a loss. Some policies have time limits in which to file claims. 
• Make any temporary repairs to protect the property from further damage or people from additional injuries.
• Do not discuss the incident with anyone other than your insurance representative or attorney.
• Arrange for a claims adjuster to inspect the property.
• Prepare a list of lost or damaged articles. Include diagrams and/or photographs if possible. 
• File a signed and sworn Proof of Loss form.

A sample loss of report form can be downloaded, free for members, from Froms & Tools.