Understanding Your Insurance Mitigation Responsibilities

9/10/2024 (Permalink)

Don't let the unknows of improper fire, water, mold and storm mitigation and restoration leave you stranded, pick SERVPRO of Mobile County.

Understanding Your Insurance Mitigation Responsibilities

Reading an insurance policy can be challenging, especially when it’s filled with legal jargon and complex terminology. One crucial section that deserves your attention is the mitigation of damages clause. This clause is a key component of all insurance policies and usually reads something like this: “Each indemnified party will take and will procure that its affiliates take all such reasonable steps and actions as are necessary to mitigate any claims under this section…” 

A "mitigation of damages" clause in an insurance policy outlines the responsibilities of the policyholder to take reasonable steps to minimize or prevent further damage to the property after an initial loss event. Here’s a general idea of what such a clause typically includes:

Key Aspects of a Mitigation of Damages Clause

1. Duty to Mitigate:

   • The clause usually requires the insured party to take reasonable actions to prevent additional damage after the initial incident. This means the property owner should act promptly to limit the extent of the damage.

2. Reasonable Steps:

   • It specifies that the steps taken must be reasonable under the circumstances. For example, if a pipe bursts, reasonable actions might include turning off the water supply and moving items to prevent water damage.

3. Requirement for Immediate Action:

   • The clause often stipulates that the insured must act as soon as possible. Delays in taking mitigation steps can affect the insurance coverage or the amount of compensation.

4. Obligation to Notify Insurer:

   • The clause might also include a requirement to notify the insurance company of the damage and the steps being taken to mitigate it. This ensures the insurer is aware of the situation and can provide guidance or support.

5. Impact on Claims:

   • Failure to adhere to the mitigation clause can lead to partial or total denial of the insurance claim. Insurers may argue that the additional damage could have been prevented if proper mitigation steps were taken.

Example Wording

While the exact wording can vary by policy and insurer, a typical mitigation of damages clause might read something like this:

“In the event of loss or damage, the Insured is required to take all reasonable steps to mitigate further damage. This includes, but is not limited to, taking immediate actions to protect the property from additional harm and notifying the insurer of the damage and mitigation actions taken. Failure to take reasonable steps to mitigate the damage may result in a reduction of the claim payment or denial of the claim.”

Importance of Understanding the Clause

Understanding and adhering to the mitigation of damages clause is crucial for ensuring that your insurance claim is processed smoothly and that you receive the coverage you’re entitled to. If you’re unsure about what constitutes reasonable mitigation actions, it’s wise to consult with restoration professionals or your insurance agent for guidance.

Why the Mitigation Clause Matters

When your property is hit by a fire, flood, or other disaster, the mitigation clause becomes highly significant. It means you, as the property owner, must take reasonable steps to prevent further damage. Ignoring this clause can have serious consequences, much like neglecting medical treatment can affect insurance claims for a car accident injury.

Common Pitfalls in Mitigation

• Failure to Tarp Roof Damage: One property owner did not cover a damaged roof, leading to further water damage. The insurer denied coverage for the additional damage because the owner did not take immediate action to mitigate the problem.
• Neglecting Vehicle Protection: Another commercial property owner left vehicles near a damaged wall. When the wall collapsed, the insurance claim was denied because the owner could have moved the vehicles to a safer location.
• Disagreements Over “Reasonable” Actions: In some cases, insurance claims are refused due to disagreements over what constitutes “reasonable” mitigation steps.

Typical Mitigation Steps Property Owners Can Take

• Flood Situations: If a pipe bursts and floods your home, you can likely turn off the main water supply and move valuable items to higher ground to prevent further damage.
• Roof Damage: For storm-damaged roofs, it’s important to protect your inventory, prevent additional weather damage, and secure the property against potential burglary.
• Safety First: Property owners are not expected to take actions that are unsafe or beyond their capabilities.

Why Professional Help is Essential

Determining what constitutes “reasonable” mitigation steps can be confusing, especially in the aftermath of a disaster. Emotional stress and trauma can further impair decision-making. That’s why it's crucial to call in professional mitigation and restoration services as soon as possible.

Mitigation professionals are highly knowledgeable about the legal obligations and responsibilities specified in insurance policies. They understand exactly what steps need to be taken to comply with these requirements and ensure that damage is addressed effectively. By working closely with insurance carriers and construction partners, these experts ensure that all necessary and expected mitigation actions are executed promptly and efficiently.

Why It's Important to Call a Mitigation Company

1. Expert Knowledge: Mitigation companies like SERVPRO of Mobile County have a deep understanding of the insurance policies and the specific mitigation requirements. This expertise helps in taking the correct steps to prevent further damage and ensuring compliance with policy terms.

2. Efficient Action: Professional mitigation teams can swiftly assess the situation and implement necessary measures to address the damage. Their prompt action helps minimize the extent of the damage, which can be crucial for protecting your property and reducing overall repair costs.

3. Insurance Coordination: These professionals are experienced in working with insurance carriers. They can streamline communication and documentation, making the claims process smoother and increasing the likelihood of a favorable outcome.

4. Comprehensive Services: Mitigation companies, like SERVPRO of Mobile County provide a range of services, from water extraction and smoke removal to structural repairs. Their ability to handle all aspects of the mitigation process ensures that no detail is overlooked.

SERVPRO of Mobile County: Here to Help® 

As a locally owned and operated business with over 20 years of experience, SERVPRO of Mobile County is here to assist you with your mitigation and restoration needs. Our team will be onsite within 60 minutes of your call, ready to help you navigate the challenges of property damage and insurance claims.

For immediate assistance, call us anytime at 251-343-0534 to support you through this challenging time.