Recovering from a Disaster - Picking Up the Pieces

Money and Crisis

Learn to deal with contractors:

• Check with the Better Business Bureau for any complaints against the contractor.
• Request a performance bond in the total amount of the construction project, to protect you if the contractor does not complete the work to your home.
• If a contractor is subcontracting any portion of the work, request a payment bond from the contractor. This protects you from any liens being assessed to your property by the subcontractors if the contractor does not pay them.
• If a subcontractor is not involved, a signed lien waiver should be obtained from the contractor in exchange for final payment.
• If jurisdiction requires, the contractor must provide evidence that the company is licensed and bonded.
• Request a certificate of insurance which names the property owner as an additional insured.
• Keep accurate records.


Get your paperwork together.

Know how to survive financially:

• Cut back on current spending as much as possible.
• Use cash reserves if you have them. Rebuild reserves when the crisis has passed.
• Use your credit card wisely. Consider a loan instead of a high-interest balance on a credit card.
• Borrow against or liquidate assets.
• Discuss financial decisions with your family. Try to make decisions together.
• Barter repair work with neighbors and relatives.

Be cautious with tornado-related insurance claims:

Use caution when accepting checks indicating full, final payment.

• Do not sign a "Proof of Loss" form with the words "full, final and complete settlement."
• Do not accept a check from the insurance company that denotes "full, final and complete settlement." Once your property is repaired or replaced, there may be additional expenses that your insurance company should pay. If you have signed or accepted a check with the statement of "full, final and complete settlement," you may be releasing the insurance company from liability for any further damages related to the disaster.
• Keep accurate records.

Talk to your family about money matters:

• Involve all family members – who are old enough to understand – in the decision – making process.
• Be prepared for your own and your family's emotional reactions concerning finances.
• Set a specific time and place for the discussion.
• Select a location where you won't be interrupted.
• Clearly identify the issues.
• Let each family member freely discuss feelings and financial priorities.
• Negotiate to settle differences. Compromise.

Apply for grants and loans:

Financial assistance in the form of grants and loans may be available. To apply, you will need:

• An itemized list of losses with your estimates for repair or replacement.
• Copies of your federal tax returns from the last three years.
• A copy of your deed, mortgage, or lease.
• Insurance policy records.
• Proof of monthly income.
• Driver’s license and Social Security number.
• Personal and business financial statements.
• List of current loans.