With the Atlantic Hurricane Season rapidly approaching, associations should be checking with their agents and brokers to make sure that their property policies are in place and that all terms and conditions are understood. This includes the typical policies that provide coverage for events such as wind and fire, as well as flood insurance policies mostly issued by the National Flood Insurance Program.
For those with existing flood insurance policies, it is extremely important to know the conditions for coverage and to strictly comply with them in the event of a loss. These policies require prompt notice and inventories of personal property that must be submitted in accordance with the terms of the policy. Failing to comply with the proof of loss requirement can be an absolute bar to recovery despite an otherwise valid claim.
Associations should note that the following is generally required for all flood claims:
Within 60 days after the loss, send us a proof of loss, which is your statement of the amount you are claiming under the policy signed and sworn to by you, and which furnishes us with the following information:
a. The date and time of loss;
b. A brief explanation of how the loss happened;
c. Your interest (for example, “owner”) and the interest, if any, of others in the damaged property;
d. Details of any other insurance that may cover the loss;
e. Changes in title or occupancy of the covered property during the term of the policy;
f. Specifications of damaged buildings and detailed repair estimates;
g. Names of mortgagees or anyone else having a lien, charge, or claim against the insured property;
h. Details about who occupied any insured building at the time of loss and for what purpose; and
i. The inventory of damaged personal property described in [Article] J.3. above.
Strict adherence to proof of loss requirements is a condition precedent to recovery under the Standard Flood Insurance Policy. Substantial compliance is not sufficient; an insured must completely satisfy the proof of loss requirements before any monetary claim can be awarded.
Failing to adhere to these guidelines can relieve the insurer of its obligation to pay even the most obvious claims. Therefore, it is important to know your requirements under the policy before a loss occurs in order to ensure that your claim is not denied on a technicality.