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Insurance Information Homeowners Should Know

Insurance Information Homeowners Should Know

Because property damage can happen to anyone, prepare yourself by having someone to turn to that knows how to address any type of property damage. Rainbow International of South & West Suburbs would like to share the following insurance information with you.

Filing a claim: If you believe you have a claim contact your insurance agent before contacting the 1-800 number unless it is an emergency situation. Your agent will verify your coverage and your deductible. If your damages do not exceed your deductible or your property damage is due to a maintenance issue you are not going to want to file a claim. If you do, it will turn into an unpaid claim on your C.L.U.E. Report. (Find out more information about the Comprehensive Loss Underwriting Exchange here:   http://oci.wi.gov/pub_list/pi-207.htm) When you contact the 1-800 number for assistance they are filing your claim as they enter your information into their system. It is best to speak with your agent so they can help you avoid an unpaid claim. 

If you have never had to file a claim then ask questions so you can understand the claims process. Ask your insurance agent to explain exactly how claims are handled, especially when it comes to releasing your insurance proceeds.


Finding a contractor: Choosing a company to restore your home or business is a big decision. If you have property damage you need a company that is reputable, reliable, responsible and capable of performing the work. Knowing how to choose a reliable home contractor can be tricky, especially if you have never done it before. 

As the policy holder, you have the right to choose who performs the work on your home. Many insurance agents make contractor recommendations while others direct you to the 1-800 number or to the internet to find one. Your home or business is your life’s work so have peace of mind that you made the right choice by researching any company you choose to do business with.

Seek a company that ...

·Is licensed, bonded and insured

·Has been in business for numerous years

·Has no lawsuits in your county and surrounding counties

·Can show you numerous pictures of projects they completed

·Is associated with the Better Business Bureau, verify they have no complaints

·Is certified by the Institute of Inspection Cleaning and Restoration Certification-IICRC

·Has positive feedback from clients online or no feedback – not every happy client will post their feedback online so no feedback is not a deterrent

·Holds themselves accountable by offering warranties on their construction

·You feel communicates thoroughly to answer all your questions and addresses your concerns

Paying your deductible: It is not up to your insurance company or contractor to pay your deductible. It is up to the home or business owner to pay their deductible.


Coverages: Review your policy with your agent to verify what will be covered in the event of a loss. We often find that people simply do not have enough building replacement cost and content coverage. In many situations there is no additional coverage added on to a policy for sewer back up or sump pump overflow so the policy owner is expected to pay out of pocket for these repairs. If you haven't taken a look at your policy in quite awhile then be proactive by visiting your insurance agent for a policy review to make sure you have accurate coverage in the event of a loss. Life changes...so should your insurance coverage.

Did you know…

·Many companies have inflation guard, which covers the increasing cost of rebuilding. This is especially important with a homeowners policy. It may have cost you $100,000 to build your home 10 years ago, but it might cost $120,000 to replace it today. 

·If you own a condo you need to understand your bylaws. Review the association bylaws to find out what portions of the home you must cover in the event of a loss. Typically it is from the drywall in. Since condo owners need their contents policy to cover things like cabinets and fixtures, they need a bit more insurance than the typical renter.

·According to many city ordinances, you are responsible for the maintenance and repair of you house or sewer pipeline between the city sanitary sewers main. Having sewer back up coverage added to your policy can prevent you from having to pay thousands out of pocket if something happened to the sewer line leading up to your home.

·Water in your basement as a result of sump pump overflow is not considered a flood and would not be covered by your flood insurance. Your insurance company will not cover the cost to perform mitigation or construction for this issue unless you have additional coverage for your sump pump.

·Flood insurance is not covered by a regular homeowner's policy.  This coverage needs to be added on to your policy. The dictionary defines "flood" as a rising and overflowing of a body of water onto normally dry land. For insurance purposes, the word "rising" in this definition is the key to distinguishing flood damage from water damage. Generally, damage caused by water that has been on the ground at some point before damaging your home is considered to be flood damage.

·A standard homeowner's insurance policy generally limits coverage for mold damage or outright excludes it, says Loretta Worters, an Insurance Information Institute vice president. Mold is typically not covered by many insurance companies unless the mold is stemming from a direct peril. At least 1,000 species of mold are common to the United States, according to the New York-based trade group the Insurance Information Institute.

·Policies generally deny coverage of damage resulting from chronic and extreme neglect and faulty maintenance. It is your responsibility to maintain your property. Your insurance will not allow you to claim your roof if it is leaking because it is extremely old and brittle. Your insurance will typically cover the claim if your roof is leaky due to wind damage or ice dams and the damage exceeds your deductible. 

·Most home insurance policies will not cover damage associated with "earth movement," such as an earthquake or sinkhole. Sinkholes are sudden gaps in the earth's surface that occur after groundwater gradually dissolves rock such as limestone and carries bits of it away, creating large pores and cracks in bedrock. Once large cavities form underground, the land above it may suddenly settle or collapse, creating the sinkhole. Sinkholes are not common in Illinois.

·Homeowners policies do not pay for termite damage according to Janet Patrick, a spokeswoman for the Illinois Insurance Association, an industry lobbying organization in Springfield, IL. Wood, paper and dead plant material that is in contact with soil near the house provide termites with a ready source of food and an entry. Moisture that has accumulated around foundations and in poorly ventilated crawl spaces gives termites a source of water they need to survive. Over time, termites can damage or destroy support beams and other wood features in a house. 

·If you do not have code upgrade on your policy you will need to pay out-of-pocket to have issues that are not within code regulations brought up to code.

·In regard to your structure, you will receive one check minus depreciation to restore your home if you have an Actual Cash Value policy (ACV). Once depreciation is deducted and you get the actual cash value then the claim is settled. Because of this, you may have to come up with some of the money for the cost of the repairs if you do not have accurate coverage. If you have a Replacement Cost Value policy (RCV) then you typically receive a check for the structure that covers the actual cash value and will later receive another check that covers the difference between ACV and RCV after your contractor completes repairs on the property.

·If you are a renter you need to have renters insurance to protect your contents. In the event of a loss, it is not your landlord's responsibility to replace your items. Their responsibility is to restore the property. The American Red Cross will only offer you a small amount of money that does not go far.


Save all receipts: Do not throw away any receipts if you are out of your home because of a loss. Your insurance company will want proof of purchase when requesting reimbursement for things. Ask your insurance agent what you can be reimbursed for.

Contents: Most people do not have an accurate amount of content coverage. You may not realize all the items you have obtained over the years. Do an inventory with your insurance agent to make sure all your contents can be replaced in the event of a loss. A RCV policy may cost a little more but it gives you the most security. 

In the event of a loss, your contents will be accounted for with a content inventory. Many items can be cleaned then stored until you return home. Items that are beyond repair will be added to your total loss list. If some of your items have disintegrated you will need to help your insurance adjuster by naming these items for your total loss list. Understand what kind of coverage you have for your contents so you know what you will receive. An Actual Cash Value (ACV) policy will offer you one check for your contents minus depreciation. Everything loses value over time and depreciation refers to value that has depleted over time. A Replacement Cost Value (RCV) policy will offer you an initial check minus depreciation for your contents and will reimburse you with multiple checks if you replace the items you lost and submit the receipts to your insurance. If you have a RCV policy and do not replace your contents or you do not send in the receipts then you will not receive any additional checks.

Temporary housing: Make sure you have accurate coverage for temporary housing if you had to be out of your home for a lengthy amount of time. Some homes can be rebuilt in a short time frame while others can be held up by things that are out of a company's control. (Ex. building permit process, time frame your insurance proceeds are released from the insurance or the mortgage, time frame it takes to agree on a scope of work, materials that are on back order.) Some homeowners may not return home for 7-8 months after a fire loss.  If there is not enough money for your temporary housing it will be cut off and you will have to figure out where you can stay until your home is finished.

Scope of work: The insurance adjuster will inspect your property and inform you of the cost to restore your property. Your contractor will submit their scope of work, estimate, to your insurance adjuster and they will negotiate until a final scope of work is settled. As a project progresses there are often hidden damages that are found as well as things that are not up to code. A supplemental estimate is then submitted to your insurance company to address these issues.


Mortgage: If you had a fire and you have a mortgage on your home then your check for the structure will include the mortgage companies name on it. This happens because your lender has a financial interest in the property that your insurer will honor/protect. This check will need to be sent to your mortgage company before any repairs can be made. After filing the proper paperwork your mortgage company will release the proceeds in a series of payments as the repairs are made and inspected by the city. A typical progress payment policy is to release 1/3 of the held proceeds up front, 1/3 upon inspection verifying 50% completion, and 1/3 upon verifying 100% completion. This process was implemented to protect the mortgage company by using your property and the house as collateral if you attempt to take your insurance rebuild money and disappear. 


Building permit: Every city requires a building permit before construction can start. The proper paperwork needs to be sent to the city before a building permit can be issued. Chicago's building permit process has recently changed and has caused some delays in obtaining these permits.

Some cities require a demolition permit before demolition can be performed.

Tax and demo: A tax and demo review is required by the city if you are repairing a structure after a fire. The city can hold back money from your structure check if you are behind on your property taxes. The city can also hold back the amount it would cost to demo your structure if you choose not to repair the property. Once the property is restored and the property taxes are up-to-date your insurance proceeds are no longer withheld by the city.

Rainbow International is ready to assist you if you need help restoring your property. We can manage any size claim whether it is big, small, residential or commercial. Our team of experts can handle any type of property claim stemming from water damage, fire damage, smoke damage, wind damage or mold damage. We work directly with your insurance provider. Rainbow International is located in Orland Park, IL with service to the Chicagoland area.  

Rainbow International's Reputation:

Better Business Bureau:

No lawsuits:


Vendor Programs:

Rainbow's Online Reviews:

Pictures of Rainbow work:

Testimonials for customers Rainbow has serviced:

Angie's List - licensed contractor:

Rainbow International made Entrepreneurs franchise 500 list in 2014! We were ranked #158:

You can have peace of mind knowing that Rainbow International is licensed, bonded and insured. Rainbow International was established in 1981 by The Dwyer Group and we are one of the 300+ Rainbow International franchises located in the U.S. & Canada.

24/7 Service Line: 708-460-0911
Email: info@rainbowrestore.net
Website:  www.rainbowrestore.net

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