When dealing with property damage, one of the biggest concerns homeowners have is whether they can choose their own contractor for insurance claim repairs. The short answer is: Yes, in most cases, you can use your own contractor. However, there are important considerations to ensure a smooth claims process and avoid complications with your insurance company.
Understanding Your Insurance Policy
Before hiring a contractor, review your insurance policy or speak with your insurance agent to confirm if there are any restrictions on contractor selection. Some insurance providers require you to use an approved or network contractor, while others allow homeowners to choose any licensed professional.
Steps to Using Your Own Contractor for an Insurance Claim
1. Obtain Approval from Your Insurance Company
- After filing a claim, your insurance provider will typically send an adjuster to assess the damage and determine a fair repair estimate.
- If you wish to use your own contractor, you may need to submit their estimate for approval before any work begins.
- Ensure your contractor’s estimate aligns with the insurance adjuster’s assessment to avoid disputes over costs.
2. Get Multiple Estimates
- Even if you have a preferred contractor, it’s wise to get multiple quotes to compare pricing.
- Your insurance company may request several estimates to ensure fair pricing.
3. Be Aware of Payment Structure
Insurance companies usually disburse claim payments in stages:
- Initial Payment (Actual Cash Value – ACV): Based on the depreciated value of the damage.
- Final Payment (Recoverable Depreciation): If you have Replacement Cost Value (RCV) coverage, the withheld amount is paid once repairs are completed and proof is provided.
4. Avoid Potential Pitfalls
- Beware of scams: Unlicensed or fraudulent contractors may take advantage of insurance claims. Choose a licensed, insured, and reputable contractor.
- Check your contractor’s credentials: Ensure they have a valid license, insurance, and references.
- Don’t sign an Assignment of Benefits (AOB) without understanding it: This document can transfer your claim rights to the contractor, which may complicate the process.
Pros & Cons of Using Your Own Contractor
| Pros | Cons |
|---|---|
| You have control over who repairs your home. | Insurance may not approve contractor’s pricing. |
| Ability to work with a contractor you trust. | Payment processing may take longer. |
| Potential for higher-quality work. | Some insurers prefer their own network contractors. |
Final Thoughts
Using your own contractor for an insurance claim is often possible, but requires proper documentation and approval from your insurer. To avoid delays and payment issues, communicate openly with both your contractor and insurance provider. If you’re unsure about your rights, consult your insurance agent to ensure you make the best decision for your home repairs.
Do you have questions about how your specific insurance policy handles contractor selection? Contact our team today!