Last year, I heard of a story about someone who was visiting their parents in Florida. Early one morning, 4:32 a.m., he got a call on his cell phone and the caller ID showed it to be his daughter. (He knew very well that it was not going to be a good call at that time of night!) She said, “Dad, my apartment building just burned to the ground.” She literally lost everything she owned, except for a small overnight bag she had with her; she was at her boyfriend’s house for the weekend. Fortunately, all residents (and pets) got out alive and unscathed. As she hung up with him that morning, her last words were, “Thank gosh my Dad made me buy a renter’s policy!” Just 52 days earlier, she had purchased (at her Dad’s directive) an HO-4 policy, at $230 a year for $30,000 of coverage on her contents.
As you can guess by this article, it was a total loss. Her HO-4 carrier paid a bit over $28,000 for this loss. Not a bad deal at all…he paid $230 and got $28,000 back.
At times, he still can’t believe that his daughter had a total loss fire. (It’s always supposed to be someone else….right?) Fortunately, she had the proper insurance, which allowed her to put her life back in order with very minimal disruption.
Folks, it can…and does…happen to any of us, as well as to you our customers. It’s not always someone else. Remember Murphy’s Law?
There are several takeaway lessons from this event:
- It’s not always the other person who has a catastrophe.
- Insurance will not prevent catastrophic losses, but it does make them easier to deal with.
- The $30,000 of contents coverage she had in this case seemed like a lot more than was needed when she bought the policy, but the claim paid nearly policy limits. Contents add up fast.
- Documentation, documentation, documentation is key; she had none. The day after her fire her dad took a digital camera and went through his entire house, taking over 180 photos of his belongings. He now has those photos stored at four different locations, over two computers, an online service, and at the house of a family member in another state. A bit overkill, but better safe than sorry!