I received a settlement loss payment from my homeowners insurance for stolen property from my home. The police just informed me they found my property at a pawn shop. Am I legally obligated to recover the stolen property worth about $3,000?
Look at the "conditions" section of your homeowners insurance policy, where the rules should be spelled out. You're generally required to tell the company if your property has been located. Many, like Liberty Mutual, then give you the choice -- either you can keep your check and they can keep the property, or you can take the property and return the check.
An added bonus for returning the check: The claim is generally erased from your record, says Alejandra Soto, spokesperson for the Insurance Information Institute. That can be particularly valuable now that homeowners insurance companies tend to be quick to raise rates or drop policyholders after making small claims. Returning the stuff can also put you ahead if you paid a big deductible before the insurance kicked in.
But keeping the money may be a smart move if you received more than you think the item is worth now -- or if you'd just rather have the cash than the property.
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