Wendy’s Briefcase – The Importance of an Agent

This month’s briefcase involves a call I got from my client.  He called because his employee had been told he had no coverage for the water in his basement, because he did not have flood coverage.  Spoiler alert, most of the following information really applies to the State of Michigan, because we don’t have many real floods, we have Michigan floods!  My client had called me because he was hoping I might help his employee.

A quick conversation cleared up the matter.  The employee had called the emergency claim number and told them he had a flood in his basement.  The person at the insurance company stated he did not have flood coverage and therefore it would not be a covered claim, end of story right?  NOT!!!!  The employee isn’t an insurance expert, he sees water and he thinks flood.  The insurance company hears the word flood and thinks flood, which is never covered, other than on a flood policy.   

In the end, the claim was covered, because I explained that he should call back and tell the insurance company that he had a “Backup of Sewers and Drains” in his basement, which he had coverage for.  The lesson to be learned, don’t tell the insurance company what caused the claim, tell them what happened, let them determine what caused it.  If you disagree with the insurance company’s determination, call your agent.  If you don’t have an agent, who will fight on your behalf?