Tips from El Paso insurance agent to navigate claims after Ruidoso wildfire destruction

RUIDOSO, NM (KVIA) -- Many Ruidoso homeowners are now facing the harsh reality of significant property loss and understanding the insurance claims process is crucial for those affected.

Local insurance agent, Ernesto Gonzalez spoke to ABC-7 and emphasized the importance of filing insurance claims as quickly as possible. He says this is the primary step in order to expedite the return. Gonzalez says insurance companies typically respond by scheduling an appointment for an adjuster to assess the damage.

The return for each homeowner will be different, Gonzalez says the type of insurance coverage of a homeowner plays a significant role. “In the particular case of the fires that are going down in New Mexico, there's a lot of cabins out there that are seasonal. There's a lot of rentals. Obviously, there's quite a few that are actual homesteads. Each particular coverage depends on what the property is used for."

Gonzalez explained the categories of coverage depending the use of the property: 

Homestead Coverage: He says this is the broadest form of coverage which will typically include the structure, furniture, jewelry, appliances, and what's known as loss of use coverage. Loss of use coverage provides compensation for additional living expenses while the property is being repaired or rebuilt.

Seasonal Cabins and Rentals: Properties that are not primary residences often have different types of coverage. Seasonal cabins may lean more towards commercial-type policies. The coverage for these properties can vary widely and may not be as comprehensive as homestead policies.

Gonzalez also explained the difference between two common types of settlements:

Total Replacement Cost: This coverage will replace the full structure minus the deductible.

Actual Cash Value Settlement: This option reimburses homeowners for the current value of the property, factoring in depreciation over time. With this, “you may end up having to pick up some of the expenses yourself," Gonzalez noted.

One major misconception among homeowners is the assumption that all insurance policies provide comprehensive coverage. "Some people will buy a limited plan and think that it covers everything, and it doesn't," Gonzalez said. 

To best prepare for unexpected natural disasters like the wildfires, he advises homeowners to review their policies annually to ensure they have the best possible coverage. “If you added space to the property from one year to the next. You might want to need to get that added and covered,” he added.