INSURANCE CLAIMS
Why Your First Insurance Settlement Offer Is Almost Never Enough
That first check feels like closure. It rarely is. Here’s how the claims process actually works — and how to make sure you get what your policy entitles you to.
You filed your claim, the adjuster came out, and a few weeks later a check showed up. It felt like progress. But if that check doesn’t cover your contractor’s estimate — or if no estimate has even been produced yet — you may be leaving thousands of dollars behind. This is one of the most common problems Michigan homeowners face after a fire, hailstorm, or water event.
How Insurance Estimates Are Built: Meet Xactimate
The majority of property insurance claims in the U.S. are estimated using software called Xactimate. Adjusters (both insurance-employed and independent) use this tool to build line-item repair scopes. It pulls pricing data from databases that are updated periodically, but those prices don’t always reflect current labor and material costs in your specific market.
The software is only as accurate as the scope of work entered. If the adjuster misses a room, underestimates square footage, skips a damaged component, or doesn’t include code-required upgrades — those items won’t appear in your estimate. And what’s not in the estimate is not in your settlement.
“The first check is not the final word. It is a starting point — and in our experience, it almost always needs to be supplemented.”
What Adjusters Commonly Miss
After working on hundreds of Michigan restoration projects, we’ve seen consistent patterns in what initial insurance estimates overlook:
- Smoke and soot damage in rooms adjacent to the fire zone, including HVAC systems
- Code-required upgrades (electrical, egress windows, insulation R-values) that must be addressed when rebuilding — covered under Ordinance & Law
- Matching requirements for flooring, siding, roofing — if you can’t match, you replace the whole surface
- Overhead and profit (O&P) — general contractors are owed a standard markup on managed projects, but insurers often leave it out of the initial estimate
- Debris removal, temporary protection, and storage during the repair period
- Permit fees and inspections required by local municipalities
What Is a Supplement Filing?
A supplement is a formal request to your insurer to add line items to your claim that were missing from the original estimate. This is a standard, legitimate part of the claims process — not an appeal, not a dispute, and not unusual. Licensed contractors submit supplement filings all the time.
At Phase III Construction, we build our own Xactimate estimates and compare them directly to the insurer’s scope. Where there are gaps — missed items, underpriced line items, missing O&P — we document and submit a supplement. We push back, in writing, with line-item justification.
💡 Know Your Rights as a Michigan Homeowner
Michigan law requires insurance companies to pay claims fairly and promptly. If your insurer is unreasonably delaying, undervaluing, or denying a legitimate claim, you can file a complaint with the Michigan Department of Insurance and Financial Services (DIFS). You can also request an appraisal under your policy if you and the insurer can’t agree on the value of a loss.
The First Check Is the Starting Point
Cash that check. But don’t sign anything that waives your right to further payments, and don’t assume it’s the end of the conversation. If your contractor’s estimate is significantly higher than the insurer’s scope — and it usually is — that gap is worth addressing. You paid premiums for full restoration. You’re entitled to it.
Phase III works alongside Michigan homeowners from the first inspection through the final payment. We pursue every dollar your policy entitles you to, and we make sure nothing gets missed along the way.
FREE CLAIM REVIEW
Settlement Doesn’t Add Up?
We review insurance estimates for free and identify what’s missing. Serving Wayne, Oakland, Washtenaw, and Livingston Counties.