There's A Reason We Have Insurance
A lot of people have a very laid back approach when it comes to insurance. Who wants to pay for something you might end up not needing? But we really all should be thinking, “I’d rather have it and not need it than need it and not have it.” With all the catastrophic damage we’ve seen the last several years you’d have to be crazy not to have insurance. It operates as a safety net, providing coverage in the event the wrath of Mother Nature finds you. People, generally, are loss-averse which means they won’t gravitate towards the path that feels like losing. Paying sums of money every month for coverage and not needing it can often feel like a loss. When you insure something for a two-year span and it doesn’t break, when you pay for health insurance for a year and never once set foot in a hospital or doctor’s office, it can feel like you wasted your money. Most people think disaster won’t happen to them, especially the longer they go without it happening.
While filming in Mexico Beach for our documentary film The Last House Standing we interviewed Attorney Scott Mager on the importance of having insurance. He makes a living helping people collect. Insurance companies are very good about billing you consistently and getting their money, but it doesn't automatically flow as easily in the other direction. Mager says, “Whether you're a business person, a homeowner, or a condo owner, the most important thing to recognize is no one is going to pay you unless you make a demand and it's properly documented.” Let’s pause right there and dissect what properly documented really means. I’m making a film about this and I can tell you I’m not even “properly documented.” Being properly documented means having pictures and proof of all the items you’ll want to replace should you face a major loss, proof that your possessions were fully intact before the disaster. If your carrier has a reason not to pay you, do you think they’ll write a check anyway out of kindness?
According to Mager you need to take a few basic steps to protect your property, “Step one, what is it going to cost me to replace what I have? My house, my contents. Whatever I need, I need to have enough insurance to make sure that it’s covered. Step two, I need to document with pictures my art, my shoes, my television, and all the things that are of value to me to show they are in good condition prior to an event such as a storm, hurricane, tornado, or any other disaster. If I do those things, I've now put down a blueprint, in stone, of exactly what I have.” If disaster strikes and hundreds of people are lined up to make claims, the person who prepared for the disaster is in a much better position.
Most people are living in the moment, and don’t believe (or don’t want to believe) that something awful is going to happen to them. I’ve been in Oklahoma and interviewed people who have been there for their entire lives and have never once seen a tornado. But we know that tornadoes happen, and people face the possibility of having to deal with them every year. I have neighbors who laugh when I bring up the importance of being prepared for a hurricane. They weren’t laughing as they were fleeing a few years ago when a hurricane just missed us. Mager points out, “I think that most people think that if there's going to be damage, it's not going to be catastrophic…and if there is damage, the insurance company's going to pay.” If that were actually true, he’d be practicing a different area of law.
So rather than just rolling the dice this storm season and thinking it won’t happen to you, look at the victims in Mexico Beach, Houston, California, Louisiana, Oklahoma, Alabama and North Carolina. See if they’d handle things differently the next time around. When it rains it often pours. If it’s going to rain, you want to be the one with a big umbrella, and if your house is potentially going to be wiped out, you want to have taken all the right steps to be able to recover.
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