Damaged property? Learn about the insurance loss claim process.

Damaged property? Learn about the insurance loss claim process.

Dealing with damage to your home can be stressful, and the insurance loss claim process can be confusing. This article explains the loss process and the steps you’ll need to take to receive your repair funds.

When should I file a homeowner’s insurance claim?

First and foremost, make sure the damage you plan to report is covered by your insurance policy. Homeowner’s insurance generally covers theft and damage from fire, smoke, wind, hail, lightning, and water. Natural disasters such as floods and earthquakes aren’t covered by standard policies; you’ll need specific insurance for these disasters.

After you confirm that the damage is covered, make sure that filing a claim is worth it; insurance claims are meant for major damage, not minor repairs. If you file multiple claims in a year, your insurer may raise your rate or even cancel your policy.

How do I file my claim?

If you decide to file a claim, there a few steps you’ll need to take to ensure a smooth process:

  • If a crime occurred, call the police immediately. When the police visit, they’ll make a report that you can use to document your claim.
  • Document everything. Take photos and videos of the damage. Throughout the claims process, it’s extremely important to document all damages and repairs, keep receipts, and take note of who you talk to and what information they give you.
  • Call your insurance provider. Your insurance company will assign an agent (adjuster) to your claim and provide you with a claim number. Your claims adjuster will explain next steps.
  • Make essential repairs. Make any repairs that are necessary to prevent further damage to your home. Don’t get rid of damaged items until your claims adjuster approves.
  • Get estimates. Contact licensed contractors for quotes to fully repair your property. Your insurance company will use those quotes to help calculate the cost of repairs.

What happens after I submit my insurance claim?

After you submit your claim to your insurance company, your adjuster will visit your property to assess the damage. They’ll calculate the cost of the repairs, create an adjuster’s report, and send a check to cover repair costs. You’ll typically receive separate checks for each type of loss on the claim. As your mortgage servicer, we’ll be listed as a payee on your settlement check(s).

If your claim equals $40,000 or less, we will require the check(s) from your insurance company and the adjuster’s report. We’ll endorse the check(s) and send them back to you to use for repairs. This process applies to claims of $20,000 or less on USDA loans.

For claims greater than $40,000, you will endorse the check(s) and send them to us. We’ll put the funds in a restricted escrow account so that repairs can be monitored. If your loan is delinquent at the time of the loss, all funds (no matter the amount) will be placed in a restricted escrow account. This process applies to claims greater than $20,000 on USDA loans.

Note: Any funds received for emergency advances or personal property will be endorsed and released to you without delay.

How do I get the money from my insurance claim funds?

If your loss is less than $40,000, we’ll endorse your check(s) and send them back to you to use for repairs.

If your loss is greater than $40,000, or if your loan was delinquent at the time of the loss, we’ll hold your funds in a restricted escrow account. Before we can draw from that account, we’ll need all of the items listed below. It will take 7-10 business days for the initial draw once we receive these completed documents:

  • Claim check signed by all parties other than Shellpoint Mortgage Servicing
  • Complete/fully itemized adjuster’s report from your insurance company
  • Signed and accepted contractor’s proposal
  • Shellpoint Mortgage Servicing Loss Draft Claim form
  • Contractor’s signed and completed W9 (delinquent loans only)
  • Signed Owner’s Affidavit (USDA loans only)

Include your loan number on all documents and check(s) and mail them to:  

Overnight mail:

Shellpoint Mortgage Servicing c/o PFIC

ATTN: Loss Draft Department

700 Tower Drive

Suite 400

Troy, MI 48098-2808

Regular mail:

Shellpoint Mortgage Servicing c/o PFIC

ATTN: Loss Draft Department

PO Box 7087

Troy, MI 48007-7087

After the initial draw, you’ll need to send us these items each time you’d like to draw funds:  

  • Inspection verifying percentage of work complete (could cost up to $60)
  • Sworn statement from your contractor or the waiver of lien

If your loan is current, the funds will be made payable to you. If your loan is delinquent, the funds will be made payable to you and your contractor. If you or your contractor have any questions, call us at (877) 826-4433 or send an email to ShellpointLD@pfic.com.

Can I use my claim funds to pay off my loan?

Under certain circumstances, yes. Paying off your loan is a multi-step process, and if your claim funds are enough to cover your payoff quote, you may be able to use them to pay off your loan. Call us at 800-365-7107 to find out if you’re eligible.

Note: If your loan is delinquent, funds from your claim cannot be used to bring your loan current. However, if you experience a total loss, we can use claim funds to pay off the loan or to require additional funding conditions.

What happens after my claim is settled?

After your claim has been settled, it’s a good time to review your insurance policy and make changes to your coverage as needed. Dealing with property damage is stressful but ensuring that you have great coverage can help!

A claim may cause your insurance rates to increase; your insurance company may be able to help you save by bundling home and auto insurance or by raising your deductible. If you still feel like you’re paying too much, shop for other providers.

Where can I find more details about the loss claim process?

If you’ve recently filed a homeowner’s insurance loss claim, we will send you a packet in the mail or to the current email address on file with detailed information that explains processing times, types of claims, and includes required documents and forms. If you haven’t received the packet or if you need help with your claim, call our Proctor Claims Department at (877) 826-4433.

If you or your property have been affected by a natural disaster, use these resources as needed:

  • To register for federal disaster relief, call the FEMA Helpline at 800-621-3362/TTY 800-462-7585.
  • Visit DisasterAssistance.gov to see if you qualify for Individual Disaster Assistance.
  • For step-by-step instructions on how to file a FEMA disaster claim and how to work with your insurance company and their adjusters, visit gov/nfip-file-your-claim.