Insurance adjusters are not the bad guys (or girls). I’d like to take this opportunity to make the point that insurance adjusters have jobs to do just like you and me. There are several critical steps in an insurance claim and the adjuster plays a key role in each one.
[An] adjuster… was “repeatedly and severely criticized for using discretion and judgment in evaluating and adjusting claims.” – Jay Feinman Delay Deny Defend 2010
This video should explain things better:
“Beginning in the 1990s… insurance companies reconsidered [their] understanding of the claims process. The insight was simple. An insurance company’s greatest expense is what it pays out in claims. If it pays out less in claims, it keeps more in profits. Therefore, the claims department became a profit center rather than the place that kept the company’s promise(s).” – Jay Feinman Delay Deny Defend 2010
“Insurance doesn’t work when the company breaks its promise in order to increase its profits.” – Jay Feinman Delay Deny Defend 2010
I’ve spent the last fifteen years working in the disaster restoration industry. If you had a flood, fire, or any other disaster covered by your insurance, I’m the guy that put your world back together. I care, and I want you to feel as if your disaster never happened.
My grandfather was an insurance agent. My uncle is an insurance agent. In the old world of insurance, the policy holder was the most important. In this world, if a client pays his or her insurance, that person is covered—completely covered. If there is a disaster, everything is taken care of.
But that is no longer the case. The industry I have known is completely changed. My clients are no longer “in good hands.” They are no longer treated “like good neighbors.” The policy holders and contractors I work with are treated with suspicion and contempt. My work to service claims is falling under the accusatory gaze of adjusters. These men and women are under constant pressure from their bosses to conform to a system that favors corporate profits over policyholders.
When the game changes, we have to innovate in order to survive and thrive. Claims Delegates exists to help you thrive in the new world of insurance claims.
Gone are the days when a homeowner can submit their contractor’s repair estimate and get paid promptly. Today’s repair estimates must be submitted using specific software, in a specific format, within specific parameters. Skip this process and your estimate is considered “Non-standard,” and these repair estimates are either completely ignored or payment is severely delayed. Worse, if the payment is made right away, it usually means that your estimate is far below what the insurance company thinks it may owe: you left money on the table.
“There’s no end to the excuses insurance companies can come up with to avoid paying claims.” – Ray Bourhis Insult to Injury 2005
Yes, the game has changed. I can show you how to play it right. “Restoration” contractors still enjoy some of the highest profit margins in the construction industry. Fire and water damage repairs continue to be extremely lucrative and rewarding. You just have to know how to play.
“Insurance companies rely upon the ignorance of their own policyholders. An uninformed policyholder will rarely argue with an adjuster, because they don’t know what they don’t know.” – Russell Longcore Insurance Claim Secrets Revealed! 2006
Homeowners that understand their rights and are willing to educate themselves will continue to enjoy settlements that far exceed those of the uneducated masses. It is not uncommon for a homeowner to receive several times what the insurance company originally offered. You just need the proper tools.
Claims Delegates helps you navigate the changing insurance landscape. I will show you the way through a minefield of restrictions, objections and “deny first, pay later” systems set up to keep insurance carriers from paying their fair share.
Photo by Clry2
Yes you can. However, you should be aware that there are some extra steps required, and you will want a contractor who is experienced in dealing with insurance companies. An insurance claim can be a great excuse to finally do that remodel project you’ve wanted to get done. A lot of the costs for the remodel like demolition, new drywall, painting and floor coverings might be fortuitously covered by your insurance settlement making that big project much more affordable.
When your home is damaged by a covered event, your insurance company owes you the money to repair your home to pre-loss condition. If you have a mortgage, your mortgage company will take steps to make sure their interest in the property is protected. The check you receive from your insurance company will have your mortgage company listed as a payee and they will hold the money in escrow until repairs are completed and inspected. Your insurance policy is a contract that requires your insurance company to pay you for damages, and your mortgage is a contract that requires you to make payments and maintain your property. Nowhere are you obliged to use your insurance money to make your home exactly the way it was before your loss.
Step 1 is to complete all required emergency services – this generally includes drying of wet materials, demolition of nonsalvageble building materials, removing contents from affected areas, cleaning of smoke or contaminated water residue, and any other service required to stabilize your home’s environment, prevent further damage, and identify 100% of the damage. These activities are covered under your policy and will not affect the payment you receive for repairs.
Step 2 is to have your insurance adjuster inspect the loss and write an estimate for repairs. It is a good idea to have your contractor present during the inspection since insurance adjusters usually do not have a construction background.
Step three – review the insurance company’s estimate for accuracy and completeness with your contractor. Things that are often inadvertently left out or undervalued by insurance adjusters are
This step is very important. If you are simply repairing damage, and extra work is required it is easy to supplement your claim, but if you are making changes, the insurance company may deny your supplement because it would not have been needed if you weren’t making the change.
Step four – With your contractor make a list of the adjustments you need to your estimate. Call your insurance adjuster and explain your adjustments one at a time. An experienced contractor will be able to help you with this process. Your goal is to come to a settlement for your claim that includes the full scope of repairs your insurance company owes you.
Once you have agreed on your settlement, you can now proceed with work on your home. Your contractor will prepare an estimate for what you want done and you can use your insurance settlement to offset your remodeling expenses.
Coverage Basics
A standard home insurance policy provides you with six different types of coverage. Each type of coverage has different policy limits and is designed to cover you for different things. Your deductible only applies once for a covered event, no matter how many of the below coverages are used.
In addition, most policies include extra coverage for debris removal, trees, shrubs and plants, and Law and ordinance also known as code update. There are usually a few other goodies available as well.
By Jeff Britton
Too many homeowners don’t file a claim because they are afraid of their deductible. They may not have the money, and are afraid “paying your deductible” means money out of their pocket. That is not true.
Your insurance company will subtract your deductible from the total of your claim, so there are lots of ways to get your damage repaired, without spending a dime of your own money. These are legal and ethical, and in no way involve any kind of fraud.
Do some of the work yourself – There are lots of activities that need to be completed to bring your home to preloss condition. Cleaning, demolition and painting are generally pretty easy to do yourself. Discuss the job with your contractor and find one or two items you are comfortable doing yourself in exchange for credit on your bill.
You can choose less expensive replacement materials – For example if you have real wood flooring, you can replace with carpet or laminate, and keep the difference. Once your claim is documented, your settlement will be based on what was there before your loss, it is perfectly acceptable to make changes during the repair. Some people even use a loss as an opportunity to remodel.
Don’t replace all of your contents – We accumulate a lot of stuff in our homes that aren’t as useful as they once were – clothing, shoes, books, old video game systems, etc. If they are damaged you are entitled to be compensated for them. Take the money and don’t replace what you don’t need.
Act as your own general contractor – Insurance claims consist of several distinct parts. Emergency services and mitigation generally need to be done quickly to prevent further damage. Hire a restoration contractor to do those activities. Repairs are not so time sensitive, contract those yourself. Your insurance company will generally pay your claim based on standardized pricing, and if you can get the work done for less, you keep the difference.
Photo: Roy Barnett Jr. via Compfight
