Flood Restoration Insurance Documentation and Claims 2

Question 1

What is a 'supplement' in the context of an insurance restoration claim?

Accepted Answer

An additional estimate submitted when the original scope is found to be incomplete after work begins

Answer

A supplement is an amended estimate submitted to the insurance company when additional damage or necessary work is discovered after the original scope was approved.

Question 2

What is the purpose of an 'Assignment of Benefits' (AOB) in flood restoration claims?

Accepted Answer

Transfer the right to collect insurance payments from the policyholder to the contractor

Answer

An Assignment of Benefits allows the policyholder to assign their insurance claim rights to the restoration contractor, who then deals directly with the insurer for payment.

Question 3

Which federal program provides flood insurance to most US homeowners since private insurers often exclude flood damage?

Accepted Answer

National Flood Insurance Program (NFIP)

Answer

The National Flood Insurance Program (NFIP), administered by FEMA, provides federally backed flood insurance because standard homeowner policies typically exclude flood damage.

Question 4

What does 'depreciation holdback' mean in an insurance claim?

Accepted Answer

The portion of an RCV claim withheld until repairs are completed and verified

Answer

Depreciation holdback is the amount withheld from the initial RCV payment that is released to the policyholder after proof of completed repairs is submitted.

Question 5

What is required to release depreciation holdback to a policyholder after flood restoration?

Accepted Answer

Proof of completed repairs such as final invoices and completion documentation

Answer

The insurer releases the depreciation holdback when the policyholder provides documentation proving that the restoration repairs have been completed, typically final paid invoices.

Flood Restoration Practice Test

Flood Restoration Practice Test

Flood Restoration Insurance Documentation and Claims 2