Large House Fire, insurance / tenant questions

[John T.]

Two nights ago the only house I manage that I don't own (favor to my GF) had a large fire causing large amounts of damage.  It was from old wiring in the house that caused it and I'm glad nobody got hurt.

 I have a list of questions I 'm struggling with.

I have never had an insurance claim quite like this.  The contractor I spoke to wants to walk and speak with the insurance adjustor.  This seems unwise to me in that I'm sure his bid will end up exactly what the insurance company will pay.  I get there could be items that actually cost more which an adjustor undervalues but those issues can be worked and a slight delay isn't a huge issue.  I also don't understand how insurance company typically hands the money out.  I know it goes to the mortgage company typically so is it up to them how they distribute it?  How are fixtures and furnishings selected?  I want to make sure I'm not getting builder grade quality items in this higher-end home. 

The renters were students at a private university.  In the lease I mention renters insurance and that they are responsible for there own belongs in the event of a fire/flood/break in etc.  They decided it wasn't worth it and they got burned (pardon the pun) so they lost a lot.  While I feel very bad for them I'm very nervous they might try to come after me for something.  Is there cause for concern here?  There lease was up Dec 31 so I told them it's basically done and they should start finding a new place to live.  The university has provided them with temporary housing due to the situation.

[Jason Bott]

@John T. tenants are responsible for their belongings and new residence.  

As for he insurance adjuster, it is standard procedure for them to inspect the loss.

The contractor wants to walk with the adjuster to make sure he is not going to do work he will compensated for.  You should attend that walk through to make sure you know where everyone stands.

The contractor will submit a bid for the worked and the adjuster will approve or decline the amounts set for each part of the job.  They will go as far to say they will only pay for painting the  1/2 of of a wall that damaged, but the other half is fine and does not need it.

Depending on your policy, you can ask for cash payout up front, but they will only give you the Actual Cash Value of the claim.  If you want to access the replacement cost of the policy, you need a contractor to be paid directly from the insurance carrier.

Let the adjuster make you an offer, if you don't like it, you can always hire an independent adjuster to handle the claim for you.