A water damage insurance claim in Michigan: steps, clocks and who to call

The order of events

A water claim has a plain sequence, and the clocks in it run from your side as well as the insurer’s. DIFS’s publication on policyholder responsibilities after a loss lists four things: notify the insurer or agent as soon as possible, take reasonable action to minimize the loss, cooperate as the policy requires, and give an inventory of damaged personal property with quantity, description, actual cash value and amount of loss. Everything below is a way of doing those four well.

What to say on the first call

DIFS’s advice is specific. Tell the insurer you have water damage and want to know what coverage is available, and do not simply say flood. The reason is that rainwater intrusion, sewer back-up or a failing sump pump may be covered under the policy, while a claim framed as flood can be read as excluded before anyone examines the cause. DIFS repeated that advice in a 2024 release after storms. It is procedural advice, not a promise that any given cause is covered.

Keep notes on every call: the date, the representative’s name and the claim number. DIFS offers a free Insurance Claim Tracking Sheet for it. Ask what the insurer needs from you and when, and ask in writing if you can.

Document before you clean

Take photographs and videos of all the damage and list damaged belongings before you clean, DIFS says, and keep damaged items until the insurer says otherwise. This is also the moment to keep your head about what is salvageable: it is for the crew and the adjuster to decide, and a thrown-away carpet cannot be inspected.

The duty to limit the loss

DIFS says most policies require reasonable steps to prevent further damage: tarp a roof, board windows, remove standing water when that is safe. Save receipts for emergency repairs and temporary supplies. DIFS’s words are that these expenses may be reimbursable, and we do not promise reimbursement. It also says not to begin permanent repairs until the insurer has inspected or says to proceed. That is the dividing line between mitigation, which you should start, and repair, which waits.

What the cause means for coverage

DIFS’s winter-storm page says standard homeowners or business owners policies cover a wide range of winter-related disasters such as burst pipes, ice dams, wind damage and leaky roofs. It says backup of sewers and drains may be available by endorsement and that flood is excluded from most standard policies. For flood, DIFS says damage is typically not covered unless you have purchased flood insurance. Use our will insurance pay tool to see what each cause means.

We could not find a DIFS page that defines sudden or accidental discharge versus seepage or gradual leaks, so we do not say a slow leak is covered or not. Read the water damage section of your policy and ask in writing.

The clocks

Under MCL 500.2006, an insurer must specify in writing the materials that are a satisfactory proof of loss within 30 days after it receives a claim, unless it settles sooner. Amounts supported by proof of loss are timely if paid within 60 days after receipt of the proof. Late benefits bear 12 percent simple interest, starting 60 days after satisfactory proof. A late payment is an unfair trade practice unless the claim is reasonably in dispute. DIFS describes the same 30 and 60 days.

Two caveats. DIFS says for fire claims that there is no time limit for the insurer to complete its investigation, so the statute’s 60 days is a payment clock, not an investigation deadline. And MCL 500.2833 sets, for fire insurance policies, a one-year limit to bring suit, or longer if the policy says so, with the period paused from notice of loss until a formal denial. The policy decides if that governs your water claim, and the DIFS pages say nothing about a suit deadline for water claims. Check the policy and ask an attorney.

Disagreeing about the amount

Under the same statute, if you and the insurer disagree on the amount of loss, either side may demand appraisal in writing. Each picks a competent independent appraiser within 20 days, the two pick an umpire, and agreement by any two sets the amount. Again this is written for fire policies, so confirm what your own policy says.

Living costs

If the home is unlivable, ask if your policy has additional living expense coverage, which may help pay for a hotel, temporary housing and meals. DIFS says it is typically 20 percent of the insurance on your house, and the declarations page gives your actual limit.

Adjusters, public adjusters and contractors

An insurer’s adjusters work for and are paid by the insurer, and you should not be asked to pay them. A public adjuster, called an adjuster for the insured, may contract with you and represent you, but must hold a DIFS license, may charge no more than 10 percent of the amount paid, must use a DIFS-approved written contract, and the contract is voidable by you for 10 days if signed within 48 hours after the loss. A public adjuster may not take a fee from a repair contractor for obtaining repair work. You are not required to hire one.

A restoration company should not negotiate your claim unless it holds an adjuster license, as we read MCL 500.1222. That is our inference, not a DIFS statement. DIFS also lists requests to sign insurance checks directly over to a contractor among its scam warning signs, and the sources here cite no Michigan law on assignment of benefits or on contractors absorbing a deductible, so we say nothing about either.

When it goes wrong

DIFS encourages resolving the dispute with the insurer first. If that does not work, call DIFS at 877-999-6442, Monday to Friday, 8 a.m. to 5 p.m., or file at Michigan.gov/DIFScomplaints. Scams and price gouging go to the Attorney General at 877-765-8388.