The Missouri Department of Insurance is alerting Joplin residents to the one-year deadline associated with incomplete insurance claims related to the May 22 tornado.
Approximately 95 percent of the homeowner and auto claims associated with the tornado have been settled, according to Travis Ford, spokesman for the department.
Policyholders have filed nearly 19,523 insurance claims. Insurance companies have paid nearly $1.5 billion in homeowners, auto and commercial property claims related to the tornado. Department officials expect that number to approach $2 billion by the time all claims are settled.
Many homeowners’ insurance policies contain 12-month deadlines for consumers to receive full compensation for their damaged property. If paperwork is submitted after the deadline, it could result in a lower claim payment.
Ford said consumers should check with their insurance agent or company — or check their policy — to find out what deadlines they face. The insurance term often used for full reimbursement is “replacement value.” After the deadline, consumers might only receive “actual cash value,” which subtracts depreciation from the value of destroyed property.
John M. Huff, director of the department, said some policies have six-month deadlines, but the department directed insurance companies last November to extend those deadlines to at least one year.
“In many cases, consumers are paid the full value for destroyed property after they pay to repair or replace it and turn in receipts to their insurance company,” said Huff, in a prepared statement. “After all they’ve been through, we want Joplin residents to receive full reimbursement for their expenses related to tornado recovery.”
Ford said there are several possible explanations for claims not having been settled. He said some consumers may still be compiling a list of personal property lost in the storm, such as furniture, electronics and clothing.
In other instances, businesses could have multiple types of insurance: Property coverage, as well as “business interruption” insurance, which helps business owners stay solvent while they are unable to do business and generate revenue. This can result in debate over the revenues and profits that would have been expected during the business outage.
Another issue that could delay the completion of a claim is disagreement over the scope of damage in that contractors, insurance companies and appraisers may disagree over how badly a property was damaged.
Consumers with questions or complaints can call the Department of Insurance Consumer hot line at 1-800-726-7390 or contact the department online at insurance.mo.gov.